During the conversion, Xero does not allow us to bring in the detailed payroll information as you would expect to see in Xero. Instead, we bring through the employees opening balances so that income statements can be created out of Xero easily at the end of the financial year. If you selected a conversion with transactional history you will receive "paid off" bills which represent the actual payments and transactions processed in your file. If you select a balances only conversion you will not be able to view any transactions or "paid off bills" in the system for the history. You will need to refer to the source accounting file for prior payslips and payment summaries.
Payroll - What Converts
Conversions include payroll set up if active in the source accounting file. If you have up to 50 paid employees the cost of setup is fully subsidised by Xero. If there are over 50 paid employees you can receive payroll setup in Xero using our premium ACCELERATE package.
We bring across the following employees:
- Employees who are active as at the start of the payroll year OR
- Employees who are inactive but meet the following:
- There is a payroll calendar set up for the employee
- There is an amount in the PAYG for the employee
- All employees set-up but never paid
NOTE - if you have terminated an employee in the current payroll year they will still come across as active, you will need to make them inactive. If you select a transactional history conversion service you will receive “paid off” bills which represent the actual payments and transactions processed in your file. This ensures that your general ledger and bank account will match the source file.
Employee data that will come across:
- Contact details
- Employment details
- Tax declaration
- Bank account details and
- Pay template.
Payroll is prepared with:
- Pay items - used in the transactional period converted. Any Pay items not used during this period of time will remain unconverted to Xero and can be added post conversion.
- Deductions and Reimbursements (will convert if not linked to a bank account)
- Superannuation deductions (convert as part of pay template)
- Employee details
- Pay templates
- Pay cycles
- Opening balances ( this displays the year to date of what each employee has been paid )
Using this information you will be able to create your payment summaries in Xero for the current financial year.
Any items that contain the word 'allowance' will be set up in Xero as an allowance.
EG. Laundry Allowance = Will convert as an Allowance Laundry per week = Will convert as Ordinary Time Earnings
Please also note that in Xero the Allowances will be converted as type 'Other' you can change this post-conversion to suit your needs if required.
We recommend that payroll settings and employee information be reviewed following a conversion including entitlement.
If you operate on a non-standard financial year please note that reporting data for payroll will only be provided on a standard financial year July - June.
What We Don't Convert and Notes:
- We do not bring across any employer expenses.
- Superannuation details and funds will not come across if the file is MYE or MYO.
- Xero's limitation is set to 200 paid employees over the previous month. The conversion brings over, all employees. Unfortunately, if you have more than 200 employees we will be unable to convert the file.
- Future dated leave does not convert you will need to replicate post-conversion.
- Xero pay items can only be associated with one expense account. If you have used various expense accounts in your source file then you will need to review/add post conversions.
- Xero subscription pricing is based on the number of employees paid, not on the total number of employees (active and inactive). If you have business with 100 plus casual employees, but only paid 20 last month, the subscription would be based on the 20, not the 100. You will need to contact your Xero account manager for the correct billing and pricing for greater than 100 employees as per the Xero pricing page
- In MYOB if you use both the generic payroll settings and the employee payroll templates, the generic settings will be converted.
IMPORTANT NOTE FOR RECKON & QB FILES: Any jobs associated with payroll entries will not come across from the Reckon source file to Xero during conversion.
Post Conversion Payroll Recommendations
Please find a list of items to keep an eye on post-conversion:
- We recommend that you check your payroll section in Xero to make sure it is up-to-date with current agreements.
- Check the Action Checklist post-conversion for the items that did not convert or were missing from the source file.
- If you are processing a mid-month conversion you may need to calculate the superannuation and PAYGW manually for the remaining months pays. More information is in our blog.
Payroll Items Linked to the "199 Clearing Account"
Sometimes during conversion, some of the deduction and reimbursement pay items have been linked to the account 199 "clearing account". This account is an account that you should not use in your Xero life, it needs to be unlinked from these pay items before preparing a pay run in Xero. The reason why that account has been linked during conversion is that in the source file these pay items may have been linked to a bank account or asset account etc. In Xero, you can only link deductions to a liability account and reimbursement items to either a liability account or expense account.
Make sure you update the chart of accounts and create the accounts needed or change any accounts to what they need to be. Here is a useful Blog on account types in Xero.
Superannuation Fund is Missing in Xero
Where possible we bring across superannuation funds for employees. If a super fund is missing it will be for one of three reasons:
- Because we didn't have enough details or there was more than one SPIN/USI number in the source file. An example is the super fund AMP, which can be one of nine different super funds depending on the spin number.
- Because the file uploaded was an MYO (Account Right or MYOB AccountEdge) or MYE file and during the extraction process we were unable to extract the Super details.
- Self-Managed Super Funds will not come across as there is no equivalent fund in Xero.
If you are missing a superannuation fund, simply add it in the payroll settings area before you attach it to the employee card. Click this link for the instructions on how to Add Superfund
Payrun Error in Xero
Xero subscription plans are based on the number of employees that are paid during a pay run. If the number of employees exceeds your subscription a message from Xero will appear during the pay run process. You will need to upgrade the subscription to complete the pay run.
- Xero pricing plan
Only the subscription holder can change the subscription plan.
- Find out who the Xero subscriber is
Plans can be upgraded at any time by the subscriber as follows:
- Xero Partners upgrading their client's subscription
- Business owners upgrading their own subscription
Cannot See Payroll in Xero
Please check here
that your user settings allows you access to payroll. If you are the subscriber you can always give yourself access. If you are not the subscriber, you need to request access to payroll from the subscriber. Xero has a limit of 100 in their subscription plans, but you can have up to 200 with a fee per employee. Please confirm with Xero pricing.
If payroll was not active in the MYOB or Reckon file then it will not have been converted.
Paying Superannuation in Xero
We suggest paying all superannuation payments up until the date of conversion using your prior system to avoid error and additional work. Depending on your software package in Xero you may have the ability to make use of Xero's Auto Superannuation Payment Process. Either way please find the guide below on how to pay superannuation using Xero.
Processing Superannuation using Auto Super
- Paying Superannuation Auto super
- Payroll Process Super
Processing Superannuation without Auto Super
- Paying Superannuation manually
Please see the step by step guide here
for calculating payroll figures post-conversion.