Track Employee Loans & Advances in Payroll
YouTube: How to Record and Track Employee Loans/Advances in Payroll?
How to Record and Track Employee Loans / Advances in Payroll?
In this tutorial, we will learn how loans and advances are recorded, calculated, and adjusted during payroll generation in Logic ERP. We will walk through the complete workflow—from setting up loan accounts to posting entries in Accounts and viewing loan reports.
Create an Employee Loan Account
Steps
Navigate to Setup Module → New Account Setup.
Enter the Employee Loan Account Name.
Set Account Type: Current Assets.
Click Save to create the account.
Issue the Loan Through Bank Payment (If Accounts Linking Required)
Why This Step?
If payroll is linked with the Accounts module, the loan must be issued through a Bank Payment Entry.
Steps
Navigate to Accounts Module → Bank Payment Entry.
Enter:
Loan Amount
Employee Loan Account
Narration (optional)
Click Save to post the payment.
Record Worker Wise Loan Entry
Steps
Go to Payroll Entry Module → Worker Wise Loan Entry.
Select the Employee.
Define:
Loan Date
Loan Amount
Loan Tenure (in months)
System automatically calculates the Monthly Installment.
Enter Installment Start Date.
Keep Loan Mode Type as default.
Map the Loan Account Name (for posting GL entries).
Add Narration (press space key).
Review and Save the loan entry.
Mark Employee Attendance
Steps
Open Attendance Register Month Wise.
Select Payroll Month and Employee.
Mark attendance for the full month.
Save and close.
Generate Payroll With Loan Installment Deduction
Steps
Navigate to Payroll Entry Menu → Payroll Generation.
Select:
Payroll Month
Employee Name
Click Recalculate.
System Output
The Installment Amount will appear under the Loan Installment column.
The installment will be automatically deducted from the employee’s Net Salary.
Loan Info Button
Shows:
Total Loan Amount
Paid Installments
Pending Balance
Repayment Details
Installment amount can be edited if necessary.
Click Save to store payroll details.
Post Payroll to Accounts
Steps
Open Post Payroll to Accounts window.
Select Payroll Month → Click Refresh.
The Employee Loan Account will appear as a Credit Entry.
Click Save Voucher.
View Loan Posting in Ledger Report
Steps
Go to Financial Reports → Ledger Report.
Select the Loan Account.
Click Generate Report.
What You’ll See
First loan installment posted automatically.
Updated Running Balance.
Each month, installments continue to post as payroll is generated.
View Employee-Wise Loan Details Report
Steps
Go to Payroll Reports → Worker Wise Loan Report.
Select the Employee.
Click Create.
Report Displays
Total Loan Amount Issued
Installments Paid
Pending Installments
Remaining Loan Balance
Record Early Loan Repayment (Advance Payment)
Steps in Payroll Module
Navigate to Worker Wise Payment/Advance Entry.
Select Employee.
Review previously paid installments.
Click New Entry.
Choose Entry Type.
Enter:
Entry Date
Amount
Narration
Click Save.
If Accounts Linking Is Enabled
Record corresponding bank receipt:
Go to Accounts Module → Bank Receipt Voucher.
Enter the Amount, Loan Account, and Narration.
Click Save.
Verify in Ledger
Open Ledger Report again.
Updated Loan Balance will reflect the advance repayment.
Conclusion
Using these steps, you can efficiently manage Employee Loans and Advances in Logic ERP—from issuance and installment deductions to ledger posting and repayment tracking. This process ensures accurate payroll calculations and seamless synchronization with the Accounts module.
Last updated