ANSWER ID:32200

If you've recorded an incorrect pay and restoring a backup isn't an option, you can reverse the pay.

You should only reverse a pay if was recorded in the current financial year.

Example

An employee has been incorrectly paid twice. This employee:

  • is paid 45 hours per pay at a rate of $35 per hour
  • is enrolled in KiwiSaver with a standard 2% employee contribution and a 4% employer contribution (which is 2% above the compulsory contribution so ESCT is applicable on that portion)
  • must pay a COURT fine of $50 per pay
  • must pay IRD Arrears outstanding
  • must pay WINZ $75 per pay, and
  • must pay a LOAN repayment of $50 per pay.

Here is the original pay which has been incorrectly processed twice.
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Here is the original KiwiSaver contributions applicable.

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Here is the original pay slip.

 

To reverse the pay
  1. Change the Current pay ended on to the date the incorrect pay was processed.
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  2. If the Current pay ended on date is prior to the current PAYE period, the payroll will prompt you to reverse the PAYE period. Click Yes and follow the prompts to reverse back to the required period.
  3. Go to the Maintenance command centre and click Maintain Pay Codes.
  4. For each of the pay codes you need to use for the reversal, select the option Allow the rate to be modified (this is located on the General tab for each code).
  5. Go to the Prepare Pays command centre and click Enter Pays.
  6. Enter the negative pay as shown in the following example image. Pay particular attention as to how the pay needs to be entered.
    • The Ordinary Time hours is entered as a negative value (-45.00) in the Quantity field.
    • The KiwiSaver Quantity field will populate automatically with a negative amount.
    • The TAX/PAYE needs to be entered as a negative value (-429.03) in the Rate field.
    • The LOANSJ is entered as a negative value (-50.00) in the Quantity field. This is VERY important to ensure the loan amount adds back on to the accumulator that is attached to this code.
    • The COURTS, IRD and WINZ deductions are all entered with their respective negative values in the Rate field with a 1.00 in the Quantity field.

Here's our example:

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If the pay is reversed correctly, the original Direct Credits amount should match the reversal Direct Credits amount, except it will be in reverse.

Other areas to check

  • The reversed KiwiSaver contributions applicable. This can be viewed by clicking the Super tab in the Enter pays window as shown in the following image.
    Image
  • The reversal pay slip which can be viewed by clicking the Print tab in the Enter pays window as shown in the following image.

Above you can also see that the IRD Arrears and the LoanSJ have increased by the reversed amounts (credit amounts).

Once you have successfully processed the reversal, simply finalise the reversal the same as a normal pay.

 
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