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How to set up payroll

ContactsLaw's payroll features span payments, tax withheld, superannuation, leave recording and payroll records. In order to start using these features, the following configuration steps must be performed:
  • Enter practice-wide payroll defaults
    • Office hours, pay cycle, leave entitlements
  • Enter payroll details for each member
    • Employee type, salary/rate, leave entitlements
    • Superannuation fund details
    • TFN declaration
    • Opening balances for leave entitlements
  • Enter public holidays for the current financial year
  • Set up required controlled accounts
    • Salaries (expense)
    • Provision for superannuation (liability)
    • Superannuation (expense)
    • ATO running balance (liability)

Enter practice-wide payroll defaults

On the management tab of The Practice, click the Employment heading.
  • Enter the office hours for your practice, followed by the 'ordinary hours per day' figure - be sure to exclude any breaks from this figure; it relates to hours worked only.
  • Specify the frequency of payments; this is used to determine whether payroll payments are regular or one-off.
  • Enter the default leave and superannuation entitlements - any members whose payroll details you provide after applying this setting will use these defaults (unless you specify otherwise).
Ensure that changes are made effective on or prior-to the start of the first pay period you intend to post using ContactsLaw.

Enter payroll details for each member

Navigate to the members tab under The Practice and click the Profiles link. For each member on the payroll (configuration for members who do not receive salary/wages in the normal fashion is not necessary), click the 'Payroll' heading and provide the following details:
  • Specify the employee type and, depending on the type chosen, the salary or rate-per-hour.
  • Verify that the leave entitlements are correct.
  • Verify that the superannuation contribution is correct and specify the member's superannuation fund (create a contact if necessary). Add relevant details such as the employee/member number, payment method and narration.
  • Complete the TFN declaration for the member.
  • Enter the opening balances for the member's leave entitlements, in hours. These will depend on how much leave they have accrued as at the start of the first pay period you intend to post.
Ensure that changes are made effective on or prior-to the start of the first pay period you intend to post using ContactsLaw. If any changes occur after this date, you will have to delete them before you can backdate the details.

Enter public holidays for the current financial year

Navigate to the summary tab under The Practice and click the 'Holidays' heading. Enter the public holidays for the current financial year. A reliable list can be found on the DOCEP website. In cases where the office is closed on a date other than the celebration date for the holiday, provide the closed date.
 
This data is used to ensure that annual/sick leave is not entered for members on public holidays, and is used to post public holiday leave for members working on a part-time or casual basis.

Set up required controlled accounts

Four controlled accounts are required in order to use ContactsLaw's payroll features; salaries, provision for superannuation, superannuation and ATO running balance account.
  • Payments to members will debit the salaries account and credit the relevant cash (bank, credit card, etc) account.
  • Tax withheld will debit the salaries account and credit the ATO running balance account.
  • At the end of every pay cycle, ContactsLaw will credit the provision for superannuation account in order to track the amount of superannuation payable for the pay cycle. Note that there is no cash effect until the superannuation is paid (via the appropriate activity).
  • Whenever superannuation is paid, ContactsLaw will debit the provision for superannuation account and credit the relevant cash account. Over time, the provisional balance should return to zero.
Navigate to the general tab under The Practice and click the 'Accounts' link. Click the 'Account wizard' button. You should find that any controlled accounts which do not yet exist on your chart of accounts will be automatically ticked. Click OK to create these accounts automatically; you can review their configuration later.
 
After completing these steps, you will be able to post your first payroll payment.