Purchasing additional annual leave

Hi PriyaW, 

It can be a bit tricky to work out how to handle both the salary adjustment and leave balance in the software.

Purchased annual leave is usually handled by reducing the employee’s salary by the value of the extra leave, rather than setting up a separate deduction each pay.

In AccountRight, you’ll need to:

1. Set up a separate wage pay item/category for the purchased leave when it’s taken.
2. Set up a separate leave pay item/entitlement to track the purchased leave balance.
3. Add the purchased leave as an opening balance in the employee’s first pay run.
4. Pay the leave through the separate purchased leave wage item when it’s taken.
5. Restore the employee’s original salary at the start of the following year.

The steps vary slightly between MYOB Business and AccountRight, so have a look at Purchasing annual leave for detailed instructions.

Regards,
Genreve

Hi Genreve

Thank you for that. 

So, they basically are paid less for a 12mth period to account for the extra leave, which then means they continue to be paid whenever leave is taken. 

Is that correct. We use AccountRight - Desktop Version. 

Hi PriyaW,

Yes, that’s correct. The employee’s salary is reduced over the leave year to account for the additional leave they’re purchasing. When they take the purchased leave, it’s paid through the purchased annual leave category, so they continue to receive pay. If you need more help with this, you can also reach out to our support team through the Contact Us page.

Cheers,

Doreen