Set up the Vacation Accrual payroll calculation

1. Open 5-3-1 Payroll Calculations
2. In the data control box, enter the number you want to assign to the new calculation.
3. In the Description box, enter a brief description for the calculation.
4. Select the Tax Type  6-Vacation Accrual
5. The Calculations Type will automatically default to 3-Employer Cost
6. The Calculation Method will automatically default to 2- % Total Wages; you can change this method as desired
7. In the Default Rate box, enter the rate (typically 4%)
   • If the vacation is earned and accrued on vacation, you will calculate a different default rate by multiplying the recursive portion of the tax by the base rate.
     •  EXAMPLE:   If your default rate is 4% and you accrue vacation on top of vacation the default rate would be 4.16%.
8. In the Max Type box, select 0-None
9. In the Job Expense, Shop Expense, Overhead Expense,  and Admin Expense, boxes, enter the ledger account numbers to debit for each type of expense.
10. In the Credit Account box, enter the liability account number to credit.
    • The credit account you use to maintain the vacation balance must be an account that is set up to use subaccounts, and it cannot already have subaccounts associated with it.
11. Select the box Use employee# as subaccount
12. Click File, Save

 Assign the Vacation Accrual payroll calculation to the employee's record

1. Open 5-2-1 Employees
2. Display the employee record.
3. Click the Calculations tab.
4. In the Calculation column, enter the vacation accrual payroll calculation number.  Press enter.
5.  In the Active column, enter Yes
6. Click File, Save

CANADIAN: How to pay the employee for vacation (Vacation Payout)