Sage 50 Payroll Benefits In Kind Setup Settings – Sage 50 BIK Payrolling

What Are the Benefits Of Kind Sage 50 Payroll

Benefit in kind (BIK) in Sage 50 payroll is known as employee remuneration which is not the component of their normal pay that is processed via payroll. The BIK can be embedded on the payslip of employees for an objective of tax calculations, PRSI(Pay-related social insurance) & Universal social charge(USC) without the need for BIK amount payments to the employee which is usually named as Notional pay. While you are already using Sage 50 Payroll Bureau Manager, you have to learn about the Benefits In Kind entry of Sage payroll.

Things to Know About Payroll Benefits in Kind Sage 50 Payroll

In case you require payroll to provide the benefits instead of recording the data on a P11D there require registration with the HMRC payrolling benefits in kind online service. You must register by 5 April 2016 for the 2016/2017 tax year.

Learn How To Adjust FPS In Sage 50 Payroll to make employee salary and tax calculation correct.

How To Calculate BIK [Benefits In Kind] Sage 50 Payroll Accounting

Tax Benefits Calculation:

To Calculate the Benefits of the Tax
You must divide the benefit taxable amount by the tax period numbers in the year. You should add this info to the normal pay of the employee. You can provide payroll benefits only after you apply to HMRC & authorization. Once you apply you must allow them to know the payroll benefits and the affected employees. Here is the list of payroll benefits after registration:

• After payroll benefits registration you must enter the employees to determine the payroll benefits and add the cash equivalent benefits, or employee’s information.
• Benefits description that has been in the tax year payroll
• Now submit a P11D to HMRC with payroll benefits

Even when go for Sage 50 Bonus Payments Setup, you need to apply or edit Sage 50 Payroll Formula for right tax calculations.

How To Set Up A BIK Payment In Sage 50?

For setting up Payroll Benefits in Kind you need to follow the below steps:

1. Locate the Settings tab
2. Hit Payment and Deductions settings
3. Now select Create New payment
4. After this fill in the below information:
5. Payment category
6. Payment type
7. Click on the drop-down list
8. Select Benefit in kind
9. Next, choose one of the below options:
   • Medical insurance
   • Company car
   • Staff housing
   • Other BIK(write the payment name and description)
10. Once you are done with this hit the Save button
11. During the pay run processing, you can embed the BIK payment to the employee

When you learn all about Sage 50 Payroll Attachment of Earnings then you can calculate right federal or state tax.

How to Set up a New BIK [Benefits In Kind] in Sage 50 Payroll

Steps to Setup a new BIK in Sage 50 Payroll:

Step 1: Access Pay Elements:

• Click on the “Company” tab.
• Select “Pay Elements” from the dropdown menu.

Step 2: Add a New Pay Element:

• Click on the “New” button.
• Enter a description for the pay element, such as “Medical Insurance.”

Step 3: Select Benefits in Kind:

• Tick the checkbox labeled “Benefits in Kind” if applicable.

Step 4: National Insurance (NI) Consideration:

• If the benefit attracts NI, select the checkbox for “National Insurance.”
• If uncertain about NI applicability, confirm with HMRC.

Step 5: Save and Confirm:

• Click “OK” to save the changes.
• Click “OK” again to confirm and exit the setup process.

How to Add BIK [Benefits In Kind] to an Employee’s Record

Step 1: Select the Employee:

• Click on the “Employee” tab.
• Choose the relevant employee from the list.

Step 2: Access Employee Record:

• Click on “Employee Record” to open the employee’s details.

Step 3: Navigate to Pay Elements:

• Switch to the “Employment” tab.
• Click on “Pay Elements.”

Step 4: Choose the Payment:

• From the “Payment Name” drop-down list, select the required payment.

Step 5: Confirm and Proceed:

• Click “OK” to confirm the selection.

Step 6: Enter Additional Details (if applicable):

• If necessary, enter the relevant hours and rate for the payment.

Step 7: Add Another Payment (optional):

• Move to the next line in the Pay Elements section.
• Repeat steps 4, 5, and 6 to add another payment.

Step 8: Save and Close:

• Click “Save” to save the changes.
• Finally, click “Close” to exit the employee’s record.

Add the same BIK to multiple employees

Step 1: Choose the Employee:

• Select the relevant employee from the employee list.

Step 2: Access Global Changes:

• Click on the “Tasks” menu.
• Choose “Global Changes” from the options.

Step 3: Navigate to Payments:

• Click on “Payments” in the Global Changes window.
• Then click on “Add Payment” to add a new payment.

Step 4: Select Payments:

• Choose the required payments from the available options.

Step 5: Confirm Selection:

• Click “OK” to confirm the payment selection.
• When prompted, click “Yes” to proceed.
• Finally, click “OK” to complete the global changes.

When BIK is processed incorrectly

In case a BIK is processed incorrectly for an employee, you need to roll back the relevant pay periods and reprocess them correctly. If you’d like more information on making a correction, connect with us via Sage 50 live chat support.

Payrolling Benefits with Sage 50cloud Payroll

Use the form name P11D for each employee with Benefits in Kind or embed the benefits cash equivalent value and deduct the desired tax amount to process the BIK in Sage 50 cloud payroll. However, the benefits such as accommodation, credit tokens, beneficial loans, and vouchers you will not be allowed to be pay-rolled.

Show the tax collections on benefits & expenses using the payroll through payroll benefits & expenses service.

Online Service:

If you select payroll to tell HMRC online then you require to register online before the tax year starts that you need to payroll for. You must embed the employee’s cash equivalent benefits to the pay & tax them via payroll. Make sure the benefit value should not be included in the tax codes of the employees. If using an online service then there is no requirement for a P11D form. Once you registered you can exclude the employees using payrolling. However, you will require sending a P11D to determine the non-payrolled benefits. After the tax year has been started then you need to payroll the benefits for the complete tax year or till you prevent providing them.

Get Help Payrolling Benefits In Kind Sage 50 Accounting

Hopefully, the write-up helped you with the Sage 50 payroll benefits in Kind. In case of any other assistance regarding Sage payroll benefits, enhancing payroll Accuracy & productivity get connected with a professional team. Use a Sage 50 Chat, phone number, or email address to reach the experts.

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FAQs – Error, Issue, Problem Benefits In Kind Sage 50