How can I correct an overpayment of wages to an employee?

Hi keating.jan,

Thanks for posting in the Community! Let me provide some information on how to correct the overpayment made on a pay run.

You can either create an ad-hoc pay run to correct the previous pay runs or leave the previous pay run as is and then on the next pay runs you can add a deduction to adjust the employee's earnings.

On the ad-hoc pay run:

1. Click the New pay run.
2. Select the same pay schedule, end date, and pay date.
3. Add impacted employee by clicking on Pay run Actions, and click on Add Employee.
4. Click on the employee's name and click Actions.
5. Choose the option you wish to amend.
6. Select the same category and enter the incorrect amount however add a (-/negative sign)to the rate or unit (**This will reverse the incorrect line on the employees year to date figures).
7. Add any missing categories normally. (This will add the correct figures to the employees year to date earnings).

Once complete only the adjusted details should be present and if you wish you can now finalise the pay run, create a pay event from it and lodge with the ATO to correct the year-to-date figures.

If you want to add a deduction to the next pay run. Make sure to set up a deduction category to be able to add it on the next pay run. Here's how:

1. Click on Payroll Settings.
2. Click on Deduction Categories.
3. Click the Add button.
4. Enter the name of the overpayment deduction.
5. Fill out other fields.
6. Click on Save.

Once you have set up your deduction categories they will now be available to be assigned to employees.

Feel free to comment below if you have more questions about QuickBooks Online Payroll. I'll be here to help you. Have a nice day!