Sage Payroll Does Not Calculate Taxes

Error description: Payroll taxes are not getting calculated after the recent upgrade of the Sage 50

Sage 50 is a trusted accounting software that is widely used across the industry and the payroll service is essential in maintaining the employee’s payroll records and for calculating of taxes. The software comes with elaborate payroll functionality and tax calculation updates with forms helpful in keeping up with the tax norms and e-filing of taxes.

However, at times there are some typical errors that come along while using Sage 50. One such error is “Sage payroll not calculating taxes after a recent update”. There can be a discrepancy between calculating the taxes on Sage 50 and taxes calculated online.

Description

  • Payroll taxes not getting calculated at all or may be calculated incorrectly
  • Payroll taxes amounts are different from the online tax calculator
  • The payroll taxes suddenly stop calculating automatically even when no changes have taken place since the last payroll processing

Causes

  • Incorrect setting
  • All latest updates haven’t been installed

Solutions

Solution 1:

Foremost, check for the latest update from Sage 50 Help and make sure it’s been installed.
Still not able to resolve the “Sage Payroll not calculating the tax error?” Move to other solutions below

Solution 2:

  • Check if the payroll ID is active and the Income is setup properly
  • Select Setup > go to Setting
  • Select Payroll > Income > Check Tax calculations
  • Verify that the income has Calc. Tax or Calc Tax are all checked
  • Open the Employee record > verify that Amount per unit and hours are set correct
  • Verify that the tax exemption for all employees are checked

Solution 3:

Check if the Payroll year is set incorrectly and rectify it

If checks are dated for the future year due to payroll year being set incorrectly, taxes won’t get calculated

Select Period from the bar > input the correct accounting period > click OK

Solution 4:

Also select the appropriate formula for the tax year

Go to Formula field next to each calculation box

Mark the checkbox next to Gross to ascertain that the formula is applied

Solution 5:

If the future payroll date is after the renewal date

Also, verify that the payroll check calculation end date should fall before the planned renewal date. The formulas have to be correctly updated to the correct year.

Solution 6:

User Account Control (UAC) may be blocking Sage 50

  • Run payroll as an Administrator and Disable UAC
  • Now check if the payroll and tax calculation reports and forms work properly

Solution 7:

Disabling the firewall to check for updates

Disable Firewall or Antivirus > Go to Sage 50 Help > Select online > Click OK > Install the latest Payroll update

Now check of the taxes are calculated correctly

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