How to Add, Edit, and Remove QuickBooks Payroll Pay Types
A walkthrough of the QuickBooks community answer for adding, editing, hiding, and removing pay types for both QuickBooks Online Payroll and Desktop users.
QuickBooks users frequently need to adjust how employee compensation is structured, whether that means switching an employee from hourly to salary, adding a recurring bonus, or cleaning up unused pay types that clutter the payroll run screen. The steps to manage these pay types differ significantly depending on whether a business uses QuickBooks Online Payroll or QuickBooks Desktop.
QuickBooks Online Payroll: Adding and Editing Base Pay
To adjust an employee’s primary compensation structure in QuickBooks Online, navigate to the Team menu via All Apps, then select Employees. From there, open the specific employee’s profile and select Job & pay.
Within the Base pay section, select Add or Edit. This opens the compensation settings, where base pay information can be configured. Users can choose a compensation type — Salary, Hourly, or Commission only. Depending on the selected type, the available fields will update. For salaried employees, the pay frequency and salary amount are required. For hourly employees, a rate per hour must be entered. For both salary and hourly structures, default working hours can be established. Once the fields are populated, select Save.
Managing Additional Pay Types in QuickBooks Online
Beyond base compensation, users often need to add supplementary earnings, such as bonuses or commission. In the same employee profile, under the Additional pay types section, select Add. You can either choose an existing pay type from the dropdown menu or create a brand new one. Fill out the necessary financial details, such as a specific rate or a recurring amount, and save the changes.
To modify an existing additional pay type, go back to the Additional pay types section and select Edit under the Actions menu. From here, fields like the name displayed on the paycheck, the rate, or the recurring amount can be updated.
Hiding and Removing Pay Types in QuickBooks Online
Over time, a payroll setup can accumulate pay types that are no longer in use. These can clutter the Run Payroll page, making it difficult to navigate. To streamline the payroll screen, go to the Run Payroll page and select Customize table. Highlight the pay types that are no longer needed to hide them from the active view.
If a pay type needs to be completely unassigned from an employee, return to the Employee profile page. Find the specific pay type under Additional pay types, click the dropdown arrow next to Edit, and select Unassign, then confirm the action.
To manage pay types at the company level — such as making a pay type completely inactive or reactivating it later — navigate to the Payroll settings. Select Edit payroll items, then Pay types. Before a pay type can be made inactive, any employees currently assigned to it must be unassigned. Select all assigned employees and choose Unassign, then select Make inactive.
Reactivating a pay type follows a similar path. Select the Inactive radio button to view hidden items, choose the pay type you wish to restore, and select Make active. You will then need to select Assign employee(s) to link the pay type back to the appropriate staff members, select Next, and enter the applicable amounts or settings.
QuickBooks Desktop: Creating New Payroll Items
In QuickBooks Desktop, compensation is managed through the Payroll Item List. To create a new pay type, open the Lists menu and select Payroll Item List. Click the Payroll Item dropdown and select New. Choose Custom Setup and proceed to the next screen.
Select Wage as the item type. Desktop users will then choose from several wage categories, including Hourly Wages, Annual Salary, Commission, or Bonus. For hourly and salary wages, further refinement is required to categorize the pay as regular, overtime, sick, or vacation pay.
After selecting the appropriate wage type, enter a name for the pay item. Next, map the item to a specific Expense account where the wages will be tracked. If the new item is a Bonus pay type, leave the Default rate field blank; the actual rate can be entered directly on the employee’s profile when the item is assigned. Select Finish to complete the setup.
Assigning and Removing Desktop Payroll Items
Once a payroll item is created in Desktop, it must be added to the individual employee. Go to the Employees menu and open the Employee Center. Double-click the employee’s name to edit their profile and navigate to the Payroll Info tab. In the Earnings section, add the newly created payroll item so it is available during payroll runs.
To remove an unwanted pay type from a Desktop employee, open their profile in the Employee Center, return to the Payroll Info tab, and locate the item in the Earnings section. Highlight the item name and the associated rate, then press Delete on the keyboard.
Finally, to remove the pay type entirely from the company file, return to the Payroll Item List. Right-click the specific item and select Make Payroll Item Inactive. If you ever need to restore an inactive item, simply right-click it again and select Make Payroll Item Active. If the inactive items are not visible in the list, ensure the Include inactive box at the bottom of the window is checked.