Vacation Pay

The vacation feature calculates an employee's vacation amount every pay period and, depending on how you pay out vacation, adds this amount to each cheque or retains for release when the employee takes time off. Additionally, Sage Simply Accounting can calculate vacation amounts on vacation paid, if it is required in an employee's province.

Calculating Vacation on Vacation Paid

Depending on the province in which your employees work, you may be required to calculate vacation pay on vacation amounts paid out (check the provincial employment standards for all of your employees). Sage Simply Accounting calculates this amount for you by multiplying the Vacation Paid amount by the vacation rate entered in the employee record. This amount is then added to the Year to Date column for Vacation Accrued. You can turn on the Calculate Vacation on Vacation Paid option on the Income tab of any employee record.

Paying Out Vacation

The vacation amount is calculated according to the percentage you entered in the box next to the Retain Vacation box on the Income tab of the employee's record.

Depending on your industry and the status of the employee, you can pay out vacation pay on each paycheque, or retain vacation pay throughout the year. Check the federal and provincial employment standards to determine your obligations as an employer.

Paying out vacation on every cheque

If you are not retaining vacation for an employee, the amount added to the employee's cheque appears on the Paycheque window's Income tab, in the This Period column for Vacation Accrued and Vacation Paid.

The Year to Date column for Vacation Paid, shows you the total vacation paid out for the current calendar year. There will never be an amount in the Year to Date column for Vacation Accrued because the vacation is paid out every period.

Retaining vacation

If you retain vacation pay for employees, you need to release their vacation pay when they take time off. The Retained Vacation feature in Sage Simply Accounting calculates and displays the amount of vacation pay retained on an employee's paycheque; based on the percentage entered in the employee's record.

Vacation Accrued - Year to Date. The vacation amount owed to the employee to date. This amount increases by the Vacation Accrued amount every pay period. It decreases whenever you pay out vacation to an employee.

Vacation Paid - This Period. The amount of vacation paid out to the employee on the current paycheque. This amount will be zero if you retain vacation, except when you pay out vacation.

Vacation Paid - Year to Date. The vacation amount that has been paid out to the employee to date. This amount only changes when you pay out vacation.

Note: Year to Date amounts only reflect Year-to-Date if you pay out vacation completely and clear paycheque details at year end. Otherwise, the amount is To Date.

If you use the Payroll Cheque Run feature, you can view the vacation details for a particular employee by selecting the employee from the list and viewing their paycheque details.

Note: It is recommended that you do not turn off these vacation features once they are enabled. Turning the features on and off will affect the integrity of your payroll records.

What do you want to do?

Calculate vacation accrued on vacation paid

Pay out vacation time on an employee's paycheque

Retain vacation pay for an employee

Process a paycheque