Wages — Regular

This Overheads code records the cost of wages — regular incurred in running the business. As an expense account, it normally carries a debit balance: debit entries increase the balance (recording new costs) and credit entries decrease it (for example, correcting an error or a refund received).

Real-world examples

Retail

A shop's core team of part-time sales assistants works fixed weekly rota hours under permanent contracts — a typical weekly wage run of £3,400 posted as a debit to 7004 (Wages — Regular) and a credit to 1200 (Bank Current Account), with no VAT involved. Because their hours are contracted and predictable, they build up holiday entitlement in the normal way, unlike casual staff paid through 7005.

Manufacturing/warehouse

A warehouse's permanent shift-floor staff are paid regular weekly wages that include a standing shift allowance for working unsociable hours — a £9,600 weekly run debited to 7004 and credited to 1200. Overtime worked beyond the contracted shift is sometimes tracked in a separate supplementary payroll figure so managers can see base labour cost against overtime spend without the two blending into one number.

Commonly confused with

Because code 7003 (Staff Salaries) sits right next to this one in Overheads, it's a common mis-posting target. Code 7004 is specifically for wages — regular, while 7003 covers staff salaries — similar in nature, but keeping them separate is what makes the overheads section of your management accounts meaningful rather than a single lumped total.

What a mis-posting here costs you

An error posting to Wages — Regular won't change total overhead spend, but it will distort the overheads breakdown that's usually reviewed line by line each month to spot cost creep.

Other codes in Overheads