The document discusses payroll accounting which involves paying employees and workers and maintaining required records. It covers payroll sheets, deductions for taxes and contributions to agencies like SSS, PhilHealth, and Pag-Ibig. Sample payroll sheets and calculations are provided for monthly and semi-monthly pay periods. Entries are shown for salaries expense, premiums payable, taxes payable, and cash paid to employees.
The document discusses payroll accounting which involves paying employees and workers and maintaining required records. It covers payroll sheets, deductions for taxes and contributions to agencies like SSS, PhilHealth, and Pag-Ibig. Sample payroll sheets and calculations are provided for monthly and semi-monthly pay periods. Entries are shown for salaries expense, premiums payable, taxes payable, and cash paid to employees.
The document discusses payroll accounting which involves paying employees and workers and maintaining required records. It covers payroll sheets, deductions for taxes and contributions to agencies like SSS, PhilHealth, and Pag-Ibig. Sample payroll sheets and calculations are provided for monthly and semi-monthly pay periods. Entries are shown for salaries expense, premiums payable, taxes payable, and cash paid to employees.
The document discusses payroll accounting which involves paying employees and workers and maintaining required records. It covers payroll sheets, deductions for taxes and contributions to agencies like SSS, PhilHealth, and Pag-Ibig. Sample payroll sheets and calculations are provided for monthly and semi-monthly pay periods. Entries are shown for salaries expense, premiums payable, taxes payable, and cash paid to employees.
• Represents compensation paid to employees and workers.
• Employees can be paid monthly or semi-monthly while workers are paid with wages based on a daily rate, hourly rate or a piece rate. • Payroll accounting involves not only the listing of the names of employees/workers with their corresponding pay but it also involves the maintenance of records of the employees/workers as required by law because, firms acts as collecting agents for the government agencies. • As collecting agents, they file and pay taxes and also premium contributions for and in behalf of their employees/workers. • These government agencies are the Social Security system/ Government Service Insurance system, PAG- IBIG(Home Development Mutual fund) and PHILHEALTH (Philippine Health Insurance Corporation). GOVERNMENT AGENCIES
1.) Social Security System (SSS)
- As SSS member, the member enjoys the benefits such as education loan, salary loan, disability loan, maternity benefit, calamity loan, pension benefits and retirement pay.
2.) Philippine Health Insurance Corporation (PHILHEALTH)
- As a Philhealth member, one enjoys sickness and hospitalization benefits.
3.) Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno (PAG-IBIG / HDMF)
- As a PAG-IBIG member, members can apply for housing loans. PAYROLL SHEET
• Is a tabular form prepared by the payroll/accounting department to determine how much salaries and wages to be paid to employees and workers. It consists of five important columns: 1. Employee Name 2. Gross pay 3. Deductions 4. Net pay or take home pay 5. Employee signature signifying receipt of salary or wage
Employee Name Gross pay Deductions Net pay Signature
PARTS OF A PAYROLL SHEET
1. Gross pay - Represents the total compensation earned by an employee or worker for a certain period of time. - Example of compensation earned by the employee are basic salary, overtime pay and etc.
2. Deductions - Amounts deducted to the gross pay of an employee or worker to arrive to its net pay or take home pay. - Deductions may done as required by law or not. Deductions as required by law are: a.) SSS ,PHILHEALTH and PAG-IBIG premium contributions by the employee b.) Income taxes c.) Union dues - Advances may also be deducted from the gross pay of an employee, in cases when employees or workers are allowed to draw a cash advance against their compensation. 3. Net Pay or take home pay - The amount remaining after the deductions are deducted from the gross pay. PAG- IBIG CO N T R I BUT I O N TA BLE
Note: The maximum
compensation considered in computing a member’s monthly PAG-IBIG contribution is Php5,000, which equates to Php100 contribution each for the employee and the employer. This means that even if the monthly compensation of an employee exceeds Php5,000, his contribution will remain at Php100. PHILHEALTH CONTRIBUTION TABLE
Note: The monthly premium will continue to be shared equally between the employee and the employer. INCOME TAX TABLE ILLUSTRATIVE PROBLEM
Assume that the following are employees of ABC Company:
Employee Position Monthly Overtime Overtime
basic salary hours rate per hour Employee A Clerk P 11,000 8 hours P 250 Employee B Supervisor P 30,000 6 hours P 275 Employee C Manager P 75,000 0 0
ABC Company pay their employees monthly.
REQUIRED: Compute for the take home pay of each employee.
EMPLOYEE A
Gross pay: Basic Salary P 11,000 Overtime (8 hours x P 250) 2,000 P 13,000
Gross pay: Basic Salary P 30,000 Overtime (6 hours x P 275) 1,650 P 31,650
Deductions: SSS Premium contribution P 800 PAG-IBIG Premium contribution 100 PHILHEALTH premium contribution 600 (1,500) Income subject to tax P 30,150 Income tax withheld ( 1,863.40) Net pay P 28,286.60 EMPLOYEE C
Gross pay: Basic Salary P 75,000
Deductions: SSS Premium contribution P 800 PAG-IBIG Premium contribution 100 PHILHEALTH premium contribution 1,500 (2,400) Income subject to tax P 72,600 Income tax withheld ( 12,613.23) Net pay P 59,986.77 PAYROLL SHEET
Employee Gross pay SSS PAG-IBIG PHILHEALT Withholding Total Net pay Signature Name H tax Deductions
Employee A P 13,000 P 440 P 100 P 220 P0 P 760 P 12,240
Employee B 31,650 800 100 600 1,863.40 3,363.40 28,286.60
SSS Premium payable 2,040 PAG-IBIG Premium payable 300 PHILHEALTH Premium payable 2,320 Withholding taxes payable 14,476.63 Cash 100,513.37 WHAT IF EMPLOYEE A HAD A C ASH ADVANCE OF P 2,000 BEFORE THE END OF THE MONTH?
Gross pay: Basic Salary P 11,000 Overtime (8 hours x P 250) 2,000 P 13,000
Income tax withheld 0 Cash advance ( 2,000)_ Net pay P 10,240 ENTRIES:
At the time of cash advance:
Advances to Employees 2,000 Cash 2,000
At the time of payment of salaries:
Salaries expense 119,650 SSS Premium payable 2,040 PAG-IBIG Premium payable 300 PHILHEALTH Premium payable 1,320 Withholding taxes payable 14,476.63 Cash 98,513.37 Advances to employees 2,000 WHAT IF THE EMPLOYEES ARE PAID SEMI-MONTHTLY AND ASSUMING OVERTIME HOURS ARE EARNED BY THE EMPLOYEES FROM 1- 15 OF THE MONTH? EMPLOYEE A 1 – 15 of the month Gross pay: Basic Salary P 5,500 Overtime (8 hours x P 250) 2,000 P 7,500
Income tax withheld 0 Net pay P 7,120 EMPLOYEE B 1 – 15 of the month Gross pay: Basic Salary P 15,000 Overtime (6 hours x P 275) 1,650 P 16,650
Deductions: SSS Premium contribution P 400 PAG-IBIG Premium contribution 50 PHILHEALTH premium contribution 300 (750) Income subject to tax P 15,900 Income tax withheld (1,096.60) Net pay P 14,803.40 EMPLOYEE C 1 – 15 of the month Gross pay: Basic Salary P 37,500
Deductions: SSS Premium contribution P 400 PAG-IBIG Premium contribution 50 PHILHEALTH premium contribution 750 (1,200) Income subject to tax P 36,300 Income tax withheld (6,306.77 ) Net pay P 29,993.23 PAYROLL SHEET
Employee Gross pay SSS PAG-IBIG PHILHEALT Withholding Total Net pay Signature Name H tax Deductions
Employee A P 7,500 P 220 P 50 P 110 P0 P 380 P 7,120
Employee B 16,650 400 50 300 1,096.60 1,846.60 14,803.40
- The law also requires the employer to make corresponding contributions for SSS, PAG-IBIG, PHILHEALTH and EC premiums ( Employee compensation for work connected sickness or injury resulting to disability or death). Based on the previous illustrative problem(monthly pay), the schedule of the total employer contribution would be as follows:
Employee Name SSS PAG-IBIG PHILHEALTH EC
Employee A P 880 P 100 P 220 10 Employee B 1,600 100 600 30 Employee C 1,600 100 1,500 30 Total P 4,080 P 300 P 2,320 P 70 ENTRIES:
