First, do NOT use the general journal, as that will not fix your employee's 2021 T4.

Here's what I would do:

Step 1:  Print a copy of the original (wrong) payroll statement, for your records.

Step 2:  Completely reverse the original (wrong) paycheque.

Step 3: Record a paycheque with the same date and net amount as the original paycheque, but with 100% of the net pay being a 'loan'.

Step 4:  Record the 2nd paycheque, $73.01, again with 100% of net pay being a 'loan.

Step 5:  Record the original paycheque as it SHOULD HAVE BEEN and apply your two loans against it.  Hopefully, this will bring your net pay to zero, as it sounds like the employee is already fully paid.

Thank you and yes the employee has been issued both payments. 

However, I am unclear as to where to post this after I've completely reversed the orginal posting. 

Steps 3/4 recorded through the payables module? 

and Step 5 can be posted again through the payroll module with the account being the correct "loan" code. 

Our accountant has set up a payroll clearing account for one employee, do you suppose I could set up a second one for this employee and post this all through that in lieu of using "loan".

Thanks.

All of the steps should be done through the payroll module.  When I'm talking about a 'loan', I'm meaning the 'loans' line on the right-hand side of the Income tab when you're processing a paycheque.

All of the steps should be done through the payroll module.  When I'm talking about a 'loan', I'm meaning the 'loans' line on the right-hand side of the Income tab when you're processing a paycheque.