To explain how to link Magnifi’s payroll projection accounts (from Labour Drivers) to your internal payroll accounts (e.g., in Xero). This ensures projected labour costs can be compared accurately to your actual payroll costs for reporting.
Use this page when:
You are using Labour Drivers to project wages and on-costs such as superannuation, payroll tax, workers compensation, and overtime.
You want Magnifi’s projected payroll costs to align with your accounting system’s payroll accounts.
You need to prevent duplicate wage lines between Magnifi’s projection accounts and your actual payroll accounts.
You prefer to manually enter payroll projections and need the flexibility to leave accounts unlinked.
Labour Drivers is Magnifi’s preferred and most commonly adopted method for projecting wages and on-costs.
Manual entry is available but generally used only by specific business types (see Manual Payroll Projections).
When you build projections using Labour Drivers, Magnifi captures employee details (hourly rate, hours per week, etc.) and calculates the following projection accounts:
Wages
Superannuation
Payroll Tax
Workers Compensation
Overtime
These Magnifi payroll accounts are stored in the background and will not appear in the Profit & Loss Projection until you link them through:
Chart of Accounts → Payroll Link
Once linked:
The accounts appear in the Profit & Loss with an asterisk (*) to show they are derived from Labour Drivers.
Double-clicking an account shows the employee-level breakdown included in the projection.
If you don’t link accounts:
Magnifi will show its own projection accounts (e.g., Wages*).
Your accounting system will bring in its own payroll accounts (e.g., Direct Wages, Admin Wages).
This causes duplicate wage lines in your Profit & Loss.
Payroll Link ensures actuals and projections align, so you see one clean Actual vs Projection line per payroll category.
Magnifi now includes an Allocation Rules button at the top of the Payroll Link page.
Allocation Rules allow you to control how each payroll on-cost category is classified in the P&L as:
Direct
Overhead
Split (default)
When you open Allocation Rules, you will see a list of Magnifi’s labour cost categories:
Wages
Superannuation
Payroll Tax
Workers Compensation
Overtime
Each category has a drop-down rule selector.
Split = allocated based on the Direct vs Overhead employee distribution from your Labour Drivers.
Direct = 100% of this payroll category is allocated to Direct, regardless of employee assignment.
Overhead = 100% of this payroll category is allocated to Overhead, regardless of employee assignment.
Some businesses do not split labour costs between direct and overhead in their accounting system.
For those organisations, custom Allocation Rules prevent mismatches when comparing Magnifi’s projections to actuals.
Although Labour Drivers is the preferred and recommended method—because it incorporates employee-level data and supports capacity-driven wage projections—Magnifi also allows payroll to be projected manually.
Manual payroll projection is particularly useful when:
You have a large number of employees, making detailed driver setup impractical
You have a high proportion of casual staff whose hours fluctuate significantly
You are not using Xero or payroll data is not integrated
You want to enter wages at a summary level rather than per employee
If you don’t link a payroll account:
The Magnifi payroll account will not appear in the P&L
You can enter or adjust values manually in the Projections screen
If you are not using Labour Drivers:
You can project payroll manually using your own accounts (e.g., Wages A, Wages B)
If you don’t see a wage account:
Add it manually under Chart of Accounts
Or import it from Xero/CSV
Quick method:
Double-click the account in Projections to create a one-to-one % calculation (e.g., Super = 12.5% of Wages).
Advanced method:
Use the Calculations tab to apply a % to multiple accounts (e.g., Super = 12.5% of Wages A + 12.5% of Wages B).
Labour Drivers is the recommended and most accurate method for projecting wages and on-costs.
Manual wages entry is available for businesses with fluctuating labour patterns or large casual workforces.
Accounts with an asterisk (*) appear only after linking in Payroll Link.
Allocation Rules can override direct/overhead splits to ensure projections match your accounting data.
Linking is flexible—link some accounts and leave others manual.
To maintain separate Actual vs Projection reporting for multiple wage accounts, use Divisions.