What is holiday pay liability?

The holiday that employees have earned but not yet used is the company's liability to the employees. The company's holiday liability is thus the value of the outstanding paid and saved holidays for all employees.

The holiday pay liability that you post to the ledger at the end of the year should correspond to the cost the company is due to pay when employees take out their holiday. The liability should consist of both the company's liability to the employees as well as the employer's contribution based on the holiday pay liability that later will be paid to Skatteverket.

The holiday pay liability is calculated as follows:

Holiday term 10	((holiday accruing pay + holiday accruing variable pay + valuation of hours of leave) * holiday pay %) / paid days of holiday = holiday pay per day
Holiday term 20	monthly salary * (4.6% + holiday allowance %) = holiday pay per day holiday pay per day / current employment rate * average employment rate current year = holiday pay per day when employment rate is changed

In Visma Lön Smart, the company's holiday pay liability and the estimated employer's contribution on the amount are automatically posted at each pay run. The only thing you need to do manually is to zero out the accounts used before you start using the function. After that, the program takes care of everything automatically. Read more in the topic Bookkeep holiday pay liability.

The holiday pay liability list gives you an overview of your company's holiday pay liability. Read more in the topic Holiday pay liability list.

Related topics