Benefits in Kind

A Benefit in Kind (BIK) is a notional payment, which increases you employee’s taxable pay without increasing their net pay.  You can also set a BIK payment as subject to NI if required.

As an employee’s taxable pay goes up, their PAYE Liability increases.  This reduces their net pay.  A common use of BIK is to calculate the tax due on a taxable benefit.  You can either produce a P11D after the Payroll year end to report your employee’s taxable benefits or you can register with HMRC to payroll the benefits.

Payrolling the Benefits in Sage 50 Payroll

Before you can process your benefits in Sage 50 Payroll you need to set up new pay elements for any BIKs and select the Benefit in Kind check box.

The benefit in kind payment increases the employee’s pay that’s subject to tax, and if applicable NI.

If you need to process Employer NI only on a benefit, do this through their P11D, Sage 50 Payroll can’t calculate employer only NI.

Setting up a new BIK

1. Click Company then click Pay Element.
2. Click New enter a description, for example, Medical Insurance.
3. Select the checkbox beside Benefits in Kind.
4. If the benefit is subject to NI, select the checkbox beside National Insurance.

Note – If you are not sure if your BIK is subject to NI, please contact us or HMRC for advice.

5. Click OK, then OK

If the BIK is subject to National Insurance, it can increase the loan contribution for employees paying a student loan.  This is due to student loan calculating as a percentage of employees’ NIable pay.

Adding the BIK to an employee’s record

1. Select the relevant employee.
2. Click Employee then click Employee Record.
3. Elick Employment tab, then click Pay Elements.
4. From the Payment Name drop-down list, choose the required payment.
5. Click OK.
6. If required, enter the relevant hours and rate.
7. To add another payment, move to the next line then repeat Steps 4, 5 and 6.
8. Click Save then click Close.

Add the same BIK to multiple employees

1. Select the required employee(s).
2. Click Tasks, then Global Changes.
3. Click Payments, then click Add Payment.
4. Select the required payments.
5. Click OK, click Yes, then click OK.

If you need help setting up a BIK pay element or adding a BIK pay element to an employee’s record or need any other help or advice with your payroll, please contact us

We can also provide a remote access service where we can link into your computer to help you resolve your Sage Accounts or Payroll problems.

Sage 50 Accounts – Chart of Accounts

When you run management accounts in Sage the Chart of Accounts categories your nominal codes.  This allows you to analyse your income, expenditure, assets, liabilities, and capital to assess your business performance.

The Chart of Accounts lists all the nominal codes and assigns them to these categories.  You can have multiple Chart of Accounts, depending on what information you want to show.

Nominal Codes

Sage uses nominal codes to track sales and purchases etc., such as insurance, or sales.  Each code has a unique code, which you can customise to fit your numbering scheme.  When you enter a transaction such as sales invoice or a bank payment you need to assign the relevant nominal code.

Default Layout of Accounts

When you first set up your company in Sage 50 Accounts, your nominal accounts and Chart of Accounts are based on the selected business type.  Business types include sole trader, partnership, limited company, or charity.

What does the Chart of Accounts consist of?

The Chart of Accounts has two sections – Profit and Loss and Balance Sheet

Depending on where a nominal code is included in the default Chart of Accounts decides on how that nominal code is treated when the yearend routine is run.  If a nominal code has been included in the Profit and Loss section, then code is totalled and a reversing entry is entered to bring the balance down to zero.  If the nominal code has been included in a Balance Sheet section, then total of the code is just rolled forward at the year end.

Profit and Loss

The Profit and Loss section is split into various categories, Sales, Purchases, Direct Expenses, Overheads and Taxation.  In each category you can have as many lines as you want splitting or grouping the nominal codes however you want them.  The nominal codes must run together to be grouped and you cannot include one code on another line that is part of a group or your accounts will not balance.

Balance Sheet

The Balance Sheet section again is split into different categories, Fixed Assets, Current Assets, Current Liabilities, Long Term Liabilities and Capital & Reserves.  In each category you can have as many lines as you want splitting or grouping the nominal codes however you want them.  The nominal codes must run together to be grouped and you cannot include one code on another line that is part of a group or your accounts will not balance.  In Current Assets you can have “Floating” Nominal Accounts, these are nominal codes that can be included in Current Assets or Current Liabilities depending on what the balances is e.g. bank accounts whether you are in credit or overdrawn, Sage will show the balance in the correct place i.e. in the Current Assets or Current Liabilities.

Sage Payroll Year end

There are things you can do to start to prepare for the Sage Payroll year end.

Check if you have a week 53.

If you pay your employees weekly, fortnightly or four weekly and your regular pay date falls on Sunday 5^th April 2026, then you have a week 53.

Note: If you pay your employees monthly, you do not have a week 53, or, if you do not pay your employees on a Sunday, you will not have a week 53.

This is simply an extra period within the tax year.  If you have a week 53, process it as normal and the software automatically calculates the payments correctly.

Print and check the P32 Employer Payment Record

It is a good idea as we are now near the tax year end to check what you have paid to HMRC agrees to your P32, so any over or under payments can be corrected in a timely fashion.

Printing the P32 Employer Payment Record.

1. Click Reports the click Period End.
2. Select Form P32-Employer Payment Record then click Print.
3. Enter the required tax month range e.g. month 1 to 10, then click OK, OK.
4. Ensure your printer detail are correct then OK then click Close.

You have now successfully printed the P32 for the first 10 months of the Tax year.  You should now check the information on the P32 report against the payments you have made to HMRC, check that there are no under or over payments, if there are these can be corrected with your next month’s payment.

If you need help printing your P32 report and/or checking your payments against your P32 report or need any other help or advice with your payroll, please contact us

We can also provide a remote access service where we can link into your computer to help you resolve your Sage Accounts or Payroll problems.

Sage 50 Accounts

Management Reports

In Sage 50 Accounts there are various management reports which show the overall value or profitability of your business in a few short reports, such as a balance sheet, profit and loss and trial balance report.

The Balance Sheet report – Shows the worth of your business at any given period in time.  It details your business’s assets and liabilities.

The Profit and loss report – Shows how your business is doing over a specific period of time.  It shows the value of sales, purchase, expenses, and overheads, then your business’s total profit or loss.

The Trial Balance report – Shows each nominal code balance up to a specified period. The balance displays as debits or credits.

How to run a management report

1. On the navigation bar, click Nominal codes.
2. Click your management report, for example Profit and Loss.
3. Click how you want to output it, for example, Preview or Printer then click Run.
4. Select the Period e.g. April 2024 and 9: September 2024 to run a Profit and Loss account for 6 months.
5. Select the Chart of accounts you want to use, the Default Layout will have all the nominal codes included, but you can have may different layout depending on what information you want to report on.
6. Click OK.

If you would like help with running management reports, or if you need any other help with your Sage 50 Accounts, please contact us

Sage Payroll

Advance Holiday Year Wizard

When you reach the end of your holiday and/or absence year, it is easy to advance the year.  This updates the balance for the new year based on your settings.

Method

You must take care to advance the holiday year correctly, and at the correct time.  When you advance a holiday or absence year you can only undo this by restoring a backup.

Before you change the holiday or absence year end, we recommend you take a backup.

1. On the toolbars, click Wizards then click Advance Holiday Year then click Next.
2. To advance the current absence year, select the Advance check box.
3. To advance the current holiday year, select the Advance check box.
4. Check the dates are correct.
5. Click Finish the click OK.

If you need to return to before you advanced the year for any reason restore a backup to the required point.

If need help setting up a holiday scheme, advancing a holiday or absence scheme or need any other help or advice with your payroll, please contact us on.

Telephone        01691 684011/654545

Or

Email:              [email protected]

We can also provide a remote access service where we can link into your computer to help you resolve your Sage Accounts or Payroll problems.

Sage 50 Accounts

Email Debt chase Letters

In Sage 50 Accounts there are various customer debt chase letter that can easily be emailed to customers on a regular basis quickly and easily, which can save you time and money and help improve cash flow.

Email a chase letter

To email a chase letter, locate and select the layout you want to use, then click Email.

TIP: The layout goes to your draft folder if you use Microsoft Outlook and sends straight away if you use Webmail.

1. Locate and select the chase letter you want to email, (there are several chase letters included as standard and these can be customised if required), then click Email.
2. If a Criteria window appears, enter any relevant criteria, then click

If you have previously configured your email settings, the document goes to your email Inbox or Drafts folder.

3. If you have not configured your email settings, when prompted to send the document as an attachment, click
4. In the Provider drop-down, click the email provider you are using.
5. In the Format drop-down, select the requires document format.
6. Click OK.

When the email generates, enter the recipient’s email address then send the email.

If you would like help with emailing debt chase letters or emailing any other letters etc, or if you need any other help with your Sage 50 Accounts, please contact us