Digits is continuously adding new connections and expect to have more payroll connections in the future. But don’t worry—adding that info manually is simple and ensures your books are accurate.
Digits will still detect your payroll bank payments, but you’ll fill in the full picture by creating a journal entry to show the detailed cost of your payroll expenses.
Step-by-Step: How to Record Manual Payroll
1. Grab Your Payroll Report
Go to your payroll system and download the payroll journal or summary for the period you want to record. (CSV or Excel formats work best).
Review the report to identify the applicable payroll categories, such as:
- Gross wages
- Benefits (e.g. health insurance)
- Employer taxes
- Payroll processing fees
2. Prepare to Record a Journal Entry in Digits
- From your dashboard, go to Accounting > Ledger
- Click New Transaction Enter the details based on your payroll report:
- Salaries – Total gross pay for the period
- Benefits – Employer-paid benefits like health insurance or 401(k)
- Payroll Taxes – What your business paid in taxes
- Use Payroll Clearing as the offsetting account. This should match the amount pulled from your bank.Confirm accuracy of entries, then click Save & Close.
Pro Tip: Make sure your Payroll Clearing account matches your actual payroll withdrawals - this should be the total net pay + total taxes. Want to see more on journal entries? Check out Journal Entries in Digits
3. Check Your Bank Connection
Confirm your journal entry and the payments from the bank account are matched or both categorized to Payroll Clearing. When this is the case, the Payroll Clearing balance should clear to $0. If the account is not reconciling, make sure the bank account you use for payroll is connected to Digits. Go to Connections and confirm it's syncing.
More on connections: Connecting Banks & Credit Cards to Digits
4. Keep it Up-to-Date
Set a regular reminder to:
- Record payroll monthly or after each pay run
- Match bank payments to journal entries
- Verify accuracy of any remaining balances in clearing accounts
This keeps your financial reports complete and accurate.
Need a hand? Contact Digits Support—we’re always happy to walk you through it.