Reconcile payroll expense and payments

Check the payroll register against the books, and what payroll leaves to pay against the salary, PF, ESI, PT and TDS payments.

ForStaffStaff managerAdmin and super administrator

A payroll reconciliation is a close task with two checks for the month. Expense: gross pay and the employer’s PF, ESI and LWF in the payroll register against what the books show. Payments: for net salary, PF, ESI, professional tax, TDS on salary and LWF, what was unpaid at the start of the month, plus this payroll, less what was paid by month end, should equal the payable account in the books.

1. Add it to the close

  1. On the close board press Add task, give it a name and the functional area (for example Payroll), and set Type to Payroll reconciliation.
  2. To get one in every close, add it to your template the same way. Linked accounts and due days carry into each new close.

2. Bring in the payroll register

  1. Open the task and press Upload payroll register: the Excel or CSV salary register from your payroll software, one row per employee. Or paste it from Excel, or type the totals.
  2. Check what each column counts as (Gross pay, Employee PF, Employer PF and admin charges, ESI, PT, TDS, Net pay and so on), then press Use these totals. The register is attached to the task as backup.
  3. CloseDesk checks that net pay equals gross pay less deductions.

3. Books figures

Type what the books show, or open Books accounts and due dates and link each line to its accounts. Linked lines take the figure from the trial balance imported for the close on the Reconciliation page: the payable account’s credit balance, and for expenses this close’s balance less the previous close’s (in the first month of the year, the balance itself).

4. Payments

  1. Add each payment with what it paid, the date, and the UTR or challan number. Or paste lines from the bank statement (Date, Narration, Amount): EPFO, ESIC, ITNS 281 / TDS and professional tax payments are recognised from the narration.
  2. Payments after month end are listed against the due dates: PF and ESI by the 15th, TDS by the 7th (30 April for March), net salary by the 7th. Change or clear the due day of a line under Books accounts and due dates. Late payments are flagged.
  3. Next month’s payroll reconciliation starts from this month’s unpaid amounts, and counts the payments recorded here after month end, so you don’t enter them twice.

5. Sign off

Every difference must be zero or explained on its line before the task can be sent for review or approved.