Cashing up Annual Holiday Entitlement

As part of the Holidays Amendment Act 2010, from 1 April 2011, there is provision to allow an employee to have up to 1 week of current annual holiday entitlement paid out.

There are no changes required in VisionVPM, however, if you agree to grant employees this entitlement, you will need to set up a new allowance to cater for this.

Notes:

• Cashed up annual holiday is a lump sum payment and comes under Extra Pay for PAYE.
• The cashed up value is not included in holiday gross.

When you are cashing out an annual holiday entitlement, you will have to process a separate pay run, ensuring you:

1. select the Pay Correction/Bonus only check box;
2. use the correct allowance and
3. select the Exta Pay check box.

For further information please refer to the following Department of Labour website:

http://www.ers.govt.nz/updates/factsheets/cashing-up.html