Cashing out up annual leave holidays is where an employee is paid the value of annual leave instead of for annual holidays (or annual leave) without taking the time off work. It's sometimes called cashing in, cashing out or selling annual holidays.
If an employee is simply taking paid leave, learn how to pay leave. If the employee is leaving your business and has unpaid leave, find out how to process their final pay.
To cash out annual leave
|UI Text Box|
Check the rules!
There are certain rules and regulations that govern relating to the cashing out of annual leaveholidays, so first check with the appropriate regulatory body about the rules that affect you.
A good place to start in Australia is the Fair Work Ombudsman or in New Zealand visit the Employment Relations website.
The steps below describe a general scenario which might not suit your requirements. Always check with an accounting advisor (or the experts on our community forum) to clarify the best solution for your business.
To cash up annual holidays in MYOB Essentials, just include the number of hours of annual leave the employee is cashing out on their pay run, in addition to their normal pay. This will decrease their leave balance, and pay them the value of the annual leave.
For example, if an employee is cashing out 20 hours of annual leave, during a week they’ve worked 40 hours, you would pay them for 40 hours at their normal rate, as well as 20 hours of annual leave.