Explaining the money paid out of your bank account
Navigate to the ‘Banking’ tab at the top of the screen and select ‘Bank Accounts’ from the drop-down menu.
Choose the relevant bank account from the list.
Select the transaction that you would like to explain.
Select ‘Money Paid to User’ from the transaction ‘Type’ drop-down menu. Please note that this option will only be available for business bank accounts. You won’t see this option if the bank account has been marked as personal or for a user who has been allocated the role of ‘Accountant’.
Select the relevant employee from the ‘Payment to’ drop-down menu.
Select ‘Net Salary and Bonuses’ from the ‘Category’ drop-down menu.
Select ‘Explain Transaction’ to complete the process.
If the salary payment is for more than one employee, you will need to split the bank transaction to allocate the appropriate amount to each employee.
If you have more than one transaction that you need to explain as a salary payment to the same employee, tick the checkboxes to the left of the relevant transactions and select ‘Money Paid to User’ from the ‘Type’ drop-down menu in the panel on the right-hand side.
Select the relevant employee from the ‘Payment to’ drop-down menu, select ‘Net Salary and Bonuses’ from the ‘Category’ drop-down menu and select ‘Explain [X] transactions’ to explain all the selected transactions in the same way. Remember to include an appropriate description for the selected transactions. If you leave the ‘description’ field blank, the transactions will be given the original descriptions that came through for them via the bank feed import or bank statement upload.
For more information on explaining multiple transactions at once, please see this article.
What happens next?
The transaction(s) will appear in the employee’s salary account in FreeAgent, which you can access by navigating to the ‘My Money’ tab at the top of the screen and selecting ‘Salary’ from the drop-down menu.
Select the relevant employee and time period using the drop-down menus. The transaction(s) will appear under the ‘Paid’ column and will reduce the amount owed to the employee in the ‘Balance Owed’ column. The amount owed to the employee from their payslips will appear in the ‘Owed’ column.
A record of the bank transaction(s) being explained will also appear in your Audit Trail report.
FreeAgent is registered with the Financial Conduct Authority under the Payment Services Regulations 2017 (register no. 799763) for the provision of account information services.
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