Vacation Pay
The vacation feature calculates an employee's vacation amount every pay period and, depending on how you pay out vacation, adds this amount to each cheque or retains for release when the employee takes time off. Additionally, Sage 50 Accounting can calculate vacation amounts on vacation paid, if it is required in an employee's province.
Calculating Vacation Accrued on Vacation Paid
To start calculating accrued vacation pay, turn on the Calculate Vacation on Vacation Paid option on the Income tab of any employee record. Sage 50 Accounting calculates this amount for you by multiplying the Vacation Paid amount by the Vacation Rate entered in the employee record. This amount is then added to the Year to Date column for Vacation Earned.
Paying Out Vacation
The vacation amount is calculated according to the percentage entered in the Vacation Rate box on the Income tab of the employee's record.
Depending on your industry and the status of the employee, you can pay out vacation pay on each paycheque, or retain vacation pay throughout the year. Check the federal and provincial employment standards to determine your obligations as an employer.
Paying out vacation on every
paycheque
If you are not retaining vacation for an employee, the vacation amount added to the employee's paycheque appears on the Paycheque window's Vacation tab, in the This Period column for Vacation Earned and Vacation Paid.
The Year to Date column for Vacation Paid, shows you the total vacation paid out for the current calendar year. There will never be an amount in the Year to Date column for Vacation Owed because the vacation is paid out every period.
Retaining vacation
If you retain vacation pay for employees, you need to release their vacation pay when they take time off. The Retained Vacation feature in Sage 50 Accounting calculates and displays the amount of vacation pay retained on an employee's paycheque; based on the percentage entered in the employee's record.
Vacation Owed - Year to Date. The vacation amount owed to the employee to date. This amount increases by the Vacation Earned amount every pay period. It decreases whenever you pay out vacation to an employee.
Vacation Paid - This Period. The amount of vacation paid out to the employee on the current paycheque. This amount will be zero if you retain vacation, except when you enter an amount when you pay out vacation.
Vacation Paid - Year to Date. The vacation amount that has been paid out to the employee to date. This amount increases when you pay out vacation.
Note: Year to Date amounts only reflect Year-to-Date if you pay out vacation completely and clear paycheque details at year end. Otherwise, the amount is To Date.
If you use the Payroll Cheque Run feature, you can view the vacation details for a particular employee by selecting the employee from the list and viewing their paycheque details.
Note: It is recommended that you do not turn off these vacation features once they are enabled. Turning the features on and off will affect the integrity of your payroll records.