Account 70: Postings, Credit, and Balance

All employees of the enterprise are paid monthly and paid wages. Withholding taxes. In addition, employed persons may receive income in the form of interest from participation in capital. All of these amounts in accounting are displayed on account 70 "Settlements with staff for remuneration."

Destination

Account 70 is used to display information about settlements with employees for pay (for all types of salaries premiums, allowances, pensions, other payments), as well as on income from securities. The loan displays the amount of accruals, and the debit - payments.

At the enterprise, payroll accounting is carried out according to the following algorithm:

• accrual;
• retention;
• accrual of insurance premiums;
• pay.

Let's consider each stage in more detail.

Payroll

Labor costs are charged to the cost of production. therefore account 70 is debited with the accounts of “Primary Production” (20) and “Costs of sale” (44). Posting is done for the entire amount of the salary. For calculations, a time sheet (form T12, T13) and a statement (T51) are used.

Example

A production worker is accrued monthly salary in the amount of 25 thousand rubles. From it personal income tax was withheld in the amount of: 25 x 0.13 = 3.25 thousand rubles. Total payable - 21.75 thousand rubles. Accounting entries (account 70):

• DT20 KT70 - 25 thousand rubles. - accrued salary to the employee;
• DT70 KT68 - 3.25 thousand rubles. - withholding personal income tax;
• DT70 KT50 - 21.75 thousand rubles. - paid salary from the cash register.

Holding

Personal income tax is deducted from the payment monthly at a rate of 13%. The base for tax assessment can be reduced due to tax deductions (Articles 218, 219 of the Tax Code). Consider the most common of them:

• 3000 - a deduction is granted to persons with disabilities, veterans;
• 500 - deduction to participants of the Second World War;
• 1400 - deduction for the first, second child to the parent (it is valid until the income level reaches 280,000);
• 3000 - deduction for the third and subsequent children (it is valid until the income level reaches 280,000).

In order to take these benefits into account when calculating salaries, the employee must write a statement. Deductions are made out by posting: account 70 debit, account 68 credit.

Example

The organization accrued salaries to production workers in the amount of 30 thousand rubles, and to the management apparatus - 72 thousand rubles. After 4 days, the accountant goes on vacation. She relies 17.8 thousand rubles. vacation pay.

The accounts in the BU will immediately display salary amounts excluding personal income tax:

• production workers: 30 - 30 x 0.13 = 26.1 thousand rubles;
• Administration: 72 - 72 x 0.13 = 62.64 thousand rubles.
• vacation pay: 17.8 - 17.8 x 0.13 = 15.486 thousand rubles.

Assessment of premiums

The salary transfers contributions to the PFR, FSS and FFOMS. The general tariff in 2016 is 30%, of which:

• 22% - FIU;
• 2.9% - FSS;
• 5.1% - FFOMS.

These rates are valid until the annual cumulative annual income from January 1 does not exceed:

• 796 thousand rubles - for the purpose of assessing contributions of the FIU;
• 718 thousand rubles - for the purpose of assessing contributions to the FSS.

If the salary exceeds the specified limits, only a contribution to the FIU will be charged at a rate of 10%. The limit on FFOMS for 2016 has not been established. This means that contributions must be accrued for the entire amount paid at a rate of 5.1% regardless of the size of the income. All these contributions are transferred to the cost of production by posting DT20 (44) KT69.

Example

LLC builds the building on its own. In February, employees were paid salaries in the amount of 270 thousand rubles, including:

• main production - 180,000;
• management personnel - 50,000;
• sales department - 18,000;
• construction workers - 22,000.

Current account 70 will contain the following transactions:

Payroll

After registration of accruals and deductions of personal income tax, the remainder of the amount is paid to employees from the cash desk or current account. This operation is executed by wiring DT70 KT50 (51).

The law provides for the payment of income twice a month. For violation of this norm, the enterprise faces a fine of 30 to 50 thousand rubles, and for officials - 5 thousand rubles. (Article 5.27 of the Administrative Code of the Russian Federation).

Unearned time salary

Holidays and temporary disability benefits relate to payments for unworked time. They are calculated on the basis of average earnings in the same accounts as the main income. Holiday pay is recorded by posting DT20 (23, 25, 29, 44) KT70, and benefits from the Social Insurance Fund - DT69-1 KT70.

Other payouts and deductions

Through account 70, the calculation and payment of dividends is reflected: DT84 KT70. Withholdings may occur withholding when purchasing a health resort voucher. Part of the cost is paid by the employee, and the second is paid by the organization: ДТ70 КТ69-1. If an employee has funds that he previously received a subreport, but did not use, he must return them to the cashier. If by the indicated date expense report not provided, these amounts are subject to deduction from salary: DT70 KT71. If the funds were not spent on targeted needs, they are also subject to withholding: ДТ70 КТ94.

Often in the inventory process a shortage of goods and materials is found. If its amount exceeds the norm, then it is reimbursed from the income of financially responsible persons: DT70 KT73-2. If the company enters into an employee insurance contract, the source for the transfer of payments is salary: account 70 is debited from the account. 76-1. Deductions on writ of income are documented by posting DT70 KT76-4.

Example

Ltd. conducted an inventory of goods. According to BU, 120 kg of half-smoked sausage are listed in the warehouse in the amount of 11.4 thousand rubles. The inventory showed a shortage of the product in the amount of 150 rubles. The rate of loss is 27.36 rubles. Subject to reimbursement 122.64 rubles. This amount will be compensated from the salary of the warehouse.

• DT94 KT41 - 150 rubles. - written off shortage;
• DT44 KT94 - 27.36 rubles. - accounted for shortages within the limits of the rate of decline;
• DT73-2 KT94 - 122.64 rubles. - shortage above the norm is attributed to the responsible person;
• DT70 KT73-2 - 122.64 rubles. - deduction of shortages from the salary.

In-kind salary

An enterprise may give its products, goods, and other valuables to employees on account of income. This operation is made out by wiring DT70 KT90-1. The accrual of income is made out by standard posting: DT20 (23, 25, 26) KT70.

Example 1

LLC accrued to employees an income of 29.5 thousand rubles. Due to a shortage of funds, the management decided to issue products in payment of debt repayment. For this, a batch of goods was selected whose market price is equal to the amount of debt. The cost of the party is 22 thousand rubles. Products are subject to VAT (18%). To reflect these operations in the control unit, it is necessary to include in the statement of account 70 such entries:

• DT70 KT90-1 - 29.5 thousand rubles. - debts on salary are written off;
• DT90-2 KT43 - 22 thousand rubles. - written off the cost of production;
• DT90-3 KT68 - 4.5 thousand rubles. (29.5 x 0.18 / 1.18) - VAT is charged;
• DT90-9 KT99 -3 thousand rubles. (29.5 - 22 - 4.5) - reflected profit.

If at the time of salary payment the company was unable to withhold personal income tax, it is obliged to notify the tax inspectorate in writing no later than March 1 of next year, indicate the amount of tax and income from which it was not withheld. The payment of salaries in kind is executed by posting DT70 KT91-1.

Example 2

Change the conditions of the previous task. In order to pay off the debt, the management decided to give the employee materials for the same amount. Reflect these operations in the control unit:

• DT70 KT91-1 - 29.5 thousand rubles. - debts on salary are written off;
• DT91-2 KT10 - 24 thousand rubles. - the cost of materials was taken into account;
• DT91-2 KT68 - 4.5 thousand rubles - VAT is charged;
• DT91-9 KT99 - 1 thousand rubles - reflects the profit from the sale of materials.

Unpaid Income

Account 70 contains information on the deposited amounts. After receiving cash at the bank, the organization has 5 working days to pay off employees. If the employee failed to appear on time, the amount of unpaid funds shall be deposited: DT70 KT76. The deposit of the deposited amount to the bank is made out by the following transaction: DT51 KT50.

Accounting of calculations is carried out in the book of deposited wages, opened for a year. Each depositor has a separate line. It indicates the personnel number of the employee, his full name, “frozen” amount, notes on the issue of funds. Unpaid amounts are transferred to a new book. Subsequent payroll is reflected in the entry: DT76 KT50.

Analytical accounting of settlements is carried out on personal accounts, settlement books, payroll etc.

Reserve

At seasonal enterprises, holidays are not evenly distributed. Since the amount of income and all accruals to employees is included in the prime cost, for the purpose of an even distribution of costs, vacation pay is transferred to costs in equal shares throughout the year. This creates a reserve for vacation pay. The same payroll accounts are debited for this amount in the accounting department. As employees retire on vacation, money accrued by them is debited by posting DT96 KT70.

Typical Wiring

This section is best presented in tabular form.

Balance

Account 70 displays information about the calculations with employees for remuneration. Credit balance means debt to staff. In most cases, the account is passive and is reflected in the second part of the balance sheet. But there are situations when the advance paid exceeds the accrued salary for the month. This balance is recorded in debit. The employee must return the money to the cashier.