Loans deduct from the salary

according to that link

3.2 Loan Adjustment in Salary

my question is .

Lets imagine we have 3 employee in our company

Employee A --------------- salary 8000
Employee B ---------------- salary 2000
Employee C ---------------- salary 20 000

Employee C had a Loan = 60 000 according to the example in posted link
where will pay 10% in 1 year

So lets make a record For that Loan

-------------------------------------------- Debit---------------------------------- Credit

Employe C (Loan (A/C)-------- 60 000 ---------------------------------

Bank------------------------------------------------------------------------------- 60 000

First of all
we will make a sallary structure To Employee C start date 1/1/2016 ---- To 31/12/2106

Basic salary = 20 000
Deductions -:
1- Loan istallmet = 5000
2- Intrest = 500
3- Tax = 200

So Total Pay salary = 20 000 - (5000+500+200) = 14 300

IF we goto PayRoll and select all those employees

so it will open a Journal Entry (BANK ENTRY).

-------------------------------------------- Debit---------------------------------- Credit

SALARY-----------------------(8000+2000+14 300)------------------

Bank-------------------------------------------------------------------- (8000+2000+14 300)

But as we see there is no any transaction a gainst

1- Loan (A/C)
2- Intrest
3- Tax

The Journal entry that yielded from the Payroll Process Didnt make any actions and transactions a gainst all the deductions,

So untill now i have Only Two Journal Entry

  1. That Against all The employee Salary
  2. That Against Employee C Loan

I readed all the documet a lot of time But i dont know how to record those missing actions

waiting your guids dear

According To the Document That we have To create Three Accounts

1- Loan Employee C
2- Intrest
3- Salary Net pay Employee C

The Trick That i dont Understand and imagine

That its not logic To create a Salary Net pay For All our Company Employee
Lets Imagine that we Have a 1000 Employee is it logic to create a 1000 (Salary Net pay

so what is the usuful of Salary (A/C)
which can work in one step against the Banck account During Block salary Payroll Process ?

Waiting Your View.


Explained in the article is only our suggestion to manage loan deduction from salary. If you can come up with approach which is more suitable to your business needs, feel free implement it in your ERPNext account.

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Thx A lot dear for your guide

@umair sir, why is my loan repayment not showing on my payslip after running payroll.


  1. I created a loan and marked “Repay from salary”
  2. I disbursed the loan as well.
  3. Created payroll entry
  4. Drafted payslip
    Checked the salary register and it’s not showing
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