Business Tip: Earnings and Payslip Dates
In this business tip you will see the importance of back-dating your pay slip dates to the last day of the earnings interval. You will see what happens when you select an incorrect pay slip date and how it complicates earnings and amount owing calculations.
Watch the 7 minute video and if you have questions please consider leaving a comment below. We'd love to hear from you and get your feedback on this tip. Thank you.
Video Summary & Importance of Back-dating Pay Slips
When you calculate your earning interval; weekly, bi-weekly, monthly etc, make sure to set the pay slip date to the last day of the selected interval.
When the pay slip is back-dated properly your due amount will equal zero. In other words, the earnings for the interval will equal the amount paid for the interval and the two will cancel each other out.
If you do not back-date the pay slip, the amount due will not reflect the pay slip paid and therefore make your calculations confusing. In this event you risk overpaying or underpaying your contractors. As time goes on this error exacerbates and the solution is harder to come by.
On the other hand, if you do not send earnings on predefined intervals, you could use an all-time interval and allow the current date to be applied to your pay slip date. We do not recommend doing this since it will be necessary to remember when the last earnings interval was performed. In so doing, this would add additional complexity to paying contractors.
How do you manage payslip dates when calculating earnings for your consultants?