Recording a Salary

Some nonprofits have paid employees in addition to volunteers and members. The Accounting module lets you record salary payments.

• Basic information when recording a salary in Springly
• Recording the salary
• Recording the salary payment
• Recording social contribution payments

Basic information when recording a salary in Springly

To record a salary in the accounting tool, go to Accounting > Book entry → "Record a salary" in the dropdown menu at the bottom of the page.

The "Journal book entry" page works just like traditional accounting tools: for each record, you enter the account(s) to debit and credit.

There is no one-size-fits-all approach to salary entries. The journal entries required will vary depending on the type of organization, the type of employment contract, and other factors.

In this section, you can record one or more accounting records, each made up of multiple lines. Each line contains the following fields:

• Description: the name of the entry line. Example: Gross salary.
• Account: enter the accounting account affected. If in doubt, consult a certified public accountant (CPA) for guidance.
• Debit and Credit: enter the amount for the entry affecting the selected account on that line.

For each accounting record, the total debits must equal the total credits. This balance requirement is the foundation of double-entry bookkeeping.

The entries you need to record will depend on each specific situation, but let's walk through a simple example. Your employee has a gross salary of $1,900. Their pay stub breaks down as follows:

Here is what the salary entry should look like in your accounting records:

On the debit side, we have the gross salary paid to the employee and the total employer contributions. On the credit side, we have the offsetting entries: the contributions broken down line by line (including both employer and employee portions) and the net salary.

Recording the salary payment

You now need to pay the net salary to the employee. The entry to record (always using the Journal book entry mode) is as follows:

You will debit account 421 that was credited in step 1 and credit your bank account.

Recording social contribution payments

Finally, you need to record the payment of social contributions. This payment is not necessarily made at the same time as the salary is recorded. You will need to create a separate journal entry for each contribution payment.

In the example below (a fictional scenario), we will record the payment of social contributions to URSSAF. Payments to this body may be made on a quarterly basis.

Let's say the total social contributions (both employer and employee portions) owed to URSSAF for the quarter amount to $2,500.65. Since this body requires payment rounded to the nearest dollar, the amount due is $2,501.

The journal entry to record will therefore be:

Account 658 is used to record the difference between the amount on the Social Security line (account 431) and the amount actually paid to Social Security.