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Paying Annual Leave Ahead

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Paris_A
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Paris_A

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Paying Annual Leave Ahead

Hi,

 

We use MYOB Payroll 2017.1.  We pay our part-time employee monthly on the 25th of each month for the calendar month (i.e. pay for the period 1st Nov to 30th Nov will be paid on 25th Nov). 

 

In December/Jan she will be taking 10 hours annual leave (5 hrs on Dec 28 and 5 hrs on Jan 4).   She would like this to be paid in with her November pay (i.e. to be paid ahead of time).  From our reading we believe it is standard practise in NZ to pay annual leave prior to the start date of the leave.  How far prior do companies usually pay?  Does her request sound reasonable? 

 

If she didn't ask for it to be paid in November we would have paid it to her on December 18 (a week early since the normal pay date of 25th would actually fall on Christmas Day). Would it generally be accepted that paying on Dec 18 would be paying a sufficient amount of time before the holiday?

 

We are probably are quite happy to pay it ahead of time in November anyway.  If we do so, how do we enter this in her payrun?  It will be 'leave in advance' as she has not reached her anniversary yet.  Do we just put the 10 hrs in the ANHL field and then presumably we would need to adjust the PAYE according to the tax table?  Do we tax it like it is all earned in November?  Or is there a different way we should tax it?

 

Is there anything else important to consider when paying annual leave prior to the holiday?  We are based in Australia so our knowledge of NZ Payroll is limited (but increasing!  :-) )

 

Thank you!

1 REPLY
MYOB Staff Post RienaP
2,098 Posts
MYOB Staff Post
New Zealand
RienaP
MYOB Staff Post

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Re: Paying Annual Leave Ahead

Hi @Paris_A,

 

A warm welcome to the community forum and I hope you find this helpful.

 

In NZ Payroll 2017.1 you will use ANHL Pay code - Annual Leave to process her leave in advance. If you are paying her in November she needs to have enough "Total leave available" under Maintenance command centre>>Maintain Employees>>Leave Details. See below:

22.png

 

There is a webcast video that will help in Managing your Annual Leave in Advance. Please look through and let us know how you go. 

 

Leave in advance does throw the PAYE tax out so, therefore, you need to adjust your tax. I would recommend you to use PAYE calculator under Tools menu to find out what the tax would be. Once you have figured that out then override the tax amount so correct tax is deducted as the software is assuming that the pay is for the current period only. I would recommend you to look through "How do you process Pays in Advance" where you do not distort the Annual Leave Rate in the system.

 

23.png

 

Let us know how you go as we are happy to help you further. Smiley Happy

 


Regards,
Riena
MYOB Training Specialist
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