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Employer Loans

SimplePay has a built-in item with which to record employer loans. There are two steps you need to follow:

Setting Up Loan Instalment

To add an employer loan:

  1. Go to Employees, and select the relevant employee.
  2. Click on Add next to Regular Inputs, and then Employer Loan.
  3. Enter the relevant information.
  4. Click Save.

If you are going to charge the employee interest, enter the Interest rate.

Regular repayment is the total amount that will be deducted from the employee’s pay each period. If you are charging the employee interest, the interest is never deducted directly from the payslip, but is rather added to the outstanding balance.

Removal of Employer Loan item

You will not be able to remove this item until the Closing balance on the previous finalised payslip is zero. If this item was added in error and you wish to remove it from the employee’s profile completely, it must be removed from the first payslip on which it was added.

More information can be found in the following article:

Editing Loan Balance

Adding a loan to an employee tells SimplePay that the employee has a loan, but the loan will not yet have a balance, so no repayments will take place. To set a balance, click on Employer Loan under Payslip Inputs, and enter the amount next to Balance Increase.

By default, an increase in the loan balance is paid out on the current payslip, and repayments start only on the next payslip.

If you don’t want to pay out the amount on the payslip, check the Don’t pay out balance increase box. You will then also have the option to check the Balance increase is at beginning of period box, which means repayment will start on the current payslip instead of the next.

Closing balance - previous period

If the balance you’re entering is the closing balance from the previous period, both checkboxes mentioned above should be checked.

Entering a Once-off Repayment will override any regular repayment defined for this loan – on the current payslip only. You can also tick the Cash/EFT repayment (no effect on payroll) box if the repayment was made off payroll and is being recorded on SimplePay to decrease the loan balance.

More information can be found in the following article: