A cab to a client, a courier, a client lunch: somebody paid it from their own pocket and the business owes them. Record it as theirs and it waits to be repaid, in its own place in the books.
Record it
- In Books, Expenses, choose New and fill in what it was, the amount and the GST, as for any expense.
- Tick Paid by an employee and choose the Employee.
- Save. Paid through is ignored: the business has not paid anything yet.
The expense shows Paid by and their name under the vendor, and the employee’s record lists it on its Owed to them tab. In the books it sits in Reimbursements owed to staff (2450), not in Accounts payable.
Repay it on its own
Press Reimburse on the expense and record the payment from the account it left, as you would pay any expense.
Or repay it with their salary
When salaries are run, everything an employee is still owed up to the end of that month is added to their line as Repaid. It is not salary: no PF, ESI or TDS is worked out on it. To pay at the top includes it, and marking the run paid repays each expense from the same account on the same day. Undoing the payment takes the repayment back too.
An expense waiting on a draft salary run cannot be paid, changed or deleted on its own, so it is never repaid twice. Delete the draft run to take it off, or pay the run.
Something missing or wrong here? Tell us. A question that needed asking usually means a page that needed writing.