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From 1 April 2011 it is legal for an employee to cash up to one week of their 4 week entitlement annual leave each year and take the money rather than a holiday. If you provide more than 4 weeks of leave, your employee may request to cash up the extra leave as well. For example, if you allow your employees 5 weeks of leave, they may request to cash up 2 weeks of leave.

A request to cash up annual leave must be made in writing by the employee, and you must respond in writing.

The decision to cash up leave must be informed and voluntary. You cannot make an employee cash up annual leave. You may deny the request.


To cash up holiday pay
  1. From the front screen click Calculate Pays and select the employee you want to pay.
  2. Click Leave > Holiday Pay > Cash Up Holiday Pay.
    The Cashed Up Holiday window opens.
  3. Click Next, then click Next again.

  4. Click Enter Days Cashed and enter the number of days you have agreed to cash up, then click Go.

    An employee can only cash up one week of their annual holiday, unless their employee agreement entitles them to more than four weeks and you have agreed to cash up the extra leave.

  5. Click Confirm Daily Rate, enter the daily rate, then click Go.
  6. Click Next and then Confirm to confirm the cashed up holiday pay. The Select Extra Pay Tax Rate window opens.
  7. Choose the rate which applies to your employee based on their annual income, then click Next, then click Confirm to finish the process.