Reconcile payroll bank transactions in Xero
After you run a pay run and pay employees, you'll need to reconcile those payments with your accounts in Xero.
Before you start
Reconcile payroll wages paid outside of Xero
If you paid employees without using Xero, for example, a personal check or cash, you'll need to manually reconcile those payments with your accounts.
Reconcile payroll wages paid by direct deposit or check
If you paid employees with direct deposit or checks created in Xero, you can find those payroll payments and match them with your accounts. Your payroll payments are then easily reconciled with your accounts.
Reconcile payroll wages paid from a different bank account (not the bank account in your Payroll Settings)
If you paid employees using another bank account in Xero (not the one set up in your Payroll Settings), you'll need to create a transfer money transaction for the total net pay amount of the pay run. The ‘To’ account will be the bank account you've set up in your Payroll Settings. You can then reconcile the bank statement line to the transfer you've just created.
You should see both positive and negative amount in the Account Transactions tab of the bank account you've set up in your Payroll Settings.
To reconcile these amounts:
- You'll first need to create a CSV file for the positive and negative amounts to import, for example if the net pay run was $1,000, your CSV file should have positive $1,000 and negative $1,000.
- Then you can reconcile these bank statement lines using Find & Match.