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Important Dates You must forward PAYG Payment Summaries to your employees by 14 July You must forward copies of Payment Summaries and supporting information to the Tax Office by the 14 August. (Lodge electronically for best efficiency) In order to receive a tax deduction in this year the Superannuation must be paid this year ie before 30 June. If it isnt paid 21 days after the end of the quarter then no tax deduction ever
Accounting Software Packages will not let you enter pays dated after 30 th June until you have prepared your Payment Summaries and rolled the payroll to the new payroll year. However, you may find you dont have time or enough information to prepare the payments summaries before the first payrun of the new payroll year. Workaround: 1. Create a folder 2013 Payroll 2. Copy the Accounting File to the folder 3. Additionally take a backup of your Accounting File on a USB device or hard drive and label payroll2013.zip 4. Close the file to the new payroll year and enter pays 5. When ready, use the file in 2013 folder or restore the backup and prepare the 2013 payment summaries.
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Old employee cards If you have old employees showing on your list but are unable to delete their card, go into the profile tab and change them to labour hire if using v19.7 or other if using AR2013. This will remove them from the payment summary list and EMPDUPE file. If you do not change them to labour hire, the EMPDUPE file will still include details of the employees name and tax file number, regardless that there are nil payments to that employee in the EMPDUPE Employee Card File If using v19.8 or less
If using AR2013 Review employment dates The employment dates that appear on the payment summaries depend on the dates entered in the employees payroll information screen.
Ensure the employees correct start date has been entered. If the employee has been terminated in the current payroll year you will also need to enter the termination date.
B. Print an Entitlement Detail Report from 1/7/XX to 30/6/XX to review and reconcile Holiday Pay Outstanding and to outline entitlements accrued and taken for the year.
C. If Entitlement Balances are incorrect, run a payrun to adjust the balances and re-run report as at end of year. Therefore, if Harry Bowen in above report shows 28.737 Annual Leave and the correct amount is 48.737, the payrun entry as follows:
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Note these reports may look the same but they derive their information from different places.
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MYOB Australia
AccountRight Plus 2013 AccountRight Plus 2011/2012 AccountRight Plus, Premier, Enterprise AccountRight Plus, Premier, Enterprise MYOB Accounting Plus MYOB Premier MYOB Enterprise AR2013 AR2011 V19.5, V19.6, V19.7, V19.8 V19 V18.5 V12.5
V6.5
Reckon Australia
Reckon Plus, Pro, Premier and Ent 2013/14 Reckon Plus, Pro, Premier $ Ent 2012/13 Reckon Plus, Pro, Premier and Ent 2011/12 Reckon Plus, Pro, Premier and Ent 2010/11 2013/14 2012/13 2011/12 2010/11 2013/14 Automatic 2013/14 Automatic
Intuit
Intuit Web Payroll after 1 July 2013 paycycle
Xero
Xero with Integrated Payroll after 1 July 2013 pay cycle
In MYOB packages select the Payment Summaries Button and there are two options to choose from: Option 1 Individual non-business (NAT 72710B) and Employment termination payment (NAT 70868) Use this option if you wish to print your PAYG Summaries directly from MYOB and send a summary of these to the Australian Tax Office on Media. Option 2 Business and personal services income (NAT 72716B) Labour Hire and other specified payments Use this option if you have labour hire and other specified payments. This option is only to report the payments for Labour Hire and other specified payments. You are required to fill in the four-part forms provided by the ATO if using MYOB v19.7 but the new version AR2013 will automatically process the Labour Hire Employees with the Individual Payment Summaries in the EMPDUPE. You simply flag the employees as labour hire in the card details for Employment Basis.
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End of Payroll Year PAYG Payment Summary Guide (2013) Option 1 Individual non-business (NAT 72710B) and Employment termination payment (NAT 70868)
Complete Steps 1-3 which require you to enter various company information details.
NOTE: It doesnt matter if you tick categories that you havent used in your file as they will just show zero amounts in some ways it is recommended that you tick all possible options for each field so that no amounts are missed. HOWEVER: do note that categories cannot be selected for more than one field. The following is a guide: Gross Payments: Should include all wages, bonuses, commissions, holiday pay, amounts relating to unused LSL and unused AL that accrued after 17 August 93 except if paid as part of approved early retirement scheme or bona fide redundancy
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See below ATO Reference Tables for Allowances TABLE 1 - Allowances subject to PAYG withholding
Allowance type Are you required to withhold from allowances? Yes Is the allowance to be included on payment summary? If so, how should it be shown? Yes (include total allowance in gross payment) Does super guarantee apply? Yes
Allowances paid for working conditions, qualifications or special duties For example: crib, danger, dirt, height, site, shift or travelling time trade, first aid certificate or safety officer. Allowances for non-deductible expenses For example: part-day travel (no overnight absence from employee's ordinary place of
Yes
Yes
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Table 2 Allowances which are subject to a varied rate of withholding: Provided the employee is expected to incur expenses that may be able to be claimed as a tax deduction at least equal to the amount of the allowance, and provided the amount and nature of the allowance is shown separately in the accounting records of the employer.
Allowance type
Cents per kilometre car expense No payments using the approved rates (1) For payments made by applying the approved rate to the number of kilometres travelled where the usage is up to 5,000 business kilometres. For payments made by applying the approved rate to the number of kilometres travelled where the usage is in excess of 5,000 business kilometres. Award transport payments (2) For deductible transport expenses For non-deductible transport Yes (from the payment for the excess over 5,000 kms) No Yes (from total
Yes (show total allowance separately No in allowance box with an explanation) Yes (include total allowance in gross Yes
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Yes (from the excess Yes (show total allowance separately No over the threshold in allowance box with an explanation) amount) No No
Award overtime meal allowances No (4) Up to reasonable allowances amount Over reasonable allowances amount The allowance must be paid under an industrial instrument in connection with overtime worked
Yes (from the excess Yes (show total allowance separately No over reasonable in allowance box with an explanation) allowances amount)
Domestic or overseas travel No allowance involving an overnight absence from employee's ordinary place of residence (4) Up to reasonable allowances amount
No
No
Over reasonable allowances Yes (from the excess Yes (show total allowance separately No amount over reasonable in allowance box with an explanation) An allowance for overseas allowances amount) accommodation must be subject to PAYG Withholding and be shown in the allowance box on the Payment Summary
1. The approved rate is a rate which is less than or equal to the ATO rate plus 1.5 cents and varies depending on the engine capacity of the vehicle. 2. An award transport payment is a transport payment covering particular travel that was paid under an industrial instrument (that is, an award, order, determination or industrial agreement) that was in force under Australian law on 29 October 1986. 3. The current threshold amount for laundry expenses is $150. Dry cleaning allowances should have an amount withheld in accordance with Table 1. 4. Each year we publish a determination setting out the reasonable amounts for
o o o o
overtime meal allowance expenses domestic travel allowance expenses travel allowance expenses for employee truck drivers overseas travel allowance expenses.
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All tax at 31.5% All taxed at marginal rates (Leave loading >$320) 5% assessable taxed at marginal rates All Tax at 31.5% All taxed at marginal rates
Tax Free
EMPLOYMENT TERMINATION PAYMENTS (ETP) Pre 1/7/83 Component Post 1/7/83 Component Employee > 55+ years Employee < 55 years
Tax Free ETP Cap: 16.5% up to $175000 then 46.5% 31.5% up to $175000 then 46.5% ETP Payment Summary
Tax Free
EMPLOYMENT TERMINATION PAYMENTS (ETP) - Invalidity Component - Pre 1/7/83 Component Post 1/7/83 Component Employee > 55+ years Employee < 55 years
Tax Free Tax Free ETP Payment Summary ETP Cap: 16.5% up to $175000 then 46.5% 31.5% up to $175000 then 46.5%
From 1/7/12 Employment Termination Payments (ETP) now have new codes . The codes are split between either Life or Death Benefit (see below)
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NO NO YES
YES
From July 1st 2013 the rate increases to 9.25%. If paying the final pay for the year in July, adjust the rate BEFORE you process the pay so that the super accrues at the new rate. If paying the final pay on 30 th June then adjust the rate after final pay has been processed
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End of Payroll Year PAYG Payment Summary Guide (2013) Enter Reportable Fringe Benefit
If an employees total fringe benefit amount in the FB T year [1 April to 31 March] exceeds $2,000.00, the amount must be grossed-up by 1.8692 and report in the Reportable Fringe Benefit Amount column. Fringe Benefits Calculation: Benefits provided to employees that attract Fringe Benefits Tax are also included in payroll tax calculations. The taxable value of the Fringe Benefits uses the grossed up value being a gross factor of up to 1.8692. Grossed up value is the gross pay the tax office deems the employee would have had to earn to have paid for the benefit from his net pay. The benefit may including GST therefore to formulas are required Factor Calculation without GST Grossed up factor = 1 / (1 FBT rate) Therefore is FBT rate is 46.5% = 1 / (1 - .465) = 1 / (0.535) = 1.8692 Factor Calculation including GST Grossed up factor = (FBT rate + GST Rate) / (1 FBT rate) x (1 + GST Rate) x FBT Rate FBT rate is 46.5% and GST 10% = (0.465 + 0.10) / (1 - 0.465) x (1 + 0.10) x 0.465 = 0.535 / 0.535 x 1.1 x 0.465 = 0.565 / 0.27365 = 2.0647
FBT Calculation Excluding GST FBT Calculation Including GST
1,000 Employee Benefit including GST 1.8692 Factor $1869.20 Taxable Value
You must enter the grossed-up taxable value of fringe benefits received for each employee. If your employees have fringe benefits please contact the accountant of the client to discuss which of these needs to be included on the Payment Summaries.
Print 2 copies of the Payment Summaries one for the employee and one to keep on file for 5 years which is your legal obligation. Alternatively Print one copy for employees and Save the Payment summaries as PDFs on the computer.
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End of Payroll Year PAYG Payment Summary Guide (2013) Verify your Payroll Information
Add up the total tax withheld and the total Gross Payments on the Payment Summaries and compare with your payroll summary report for reconciliation. Note: If allowances are separately shown then reduce from total Gross wages. Treat ETP payments the same way. If there is a discrepancy you may have missed one employee when you chose to print the Payment Summaries (remember all employees that had payroll activity throughout the year are reported to the ATO so the EMPDUPE totals are probably right).
How to Lodge EMPDUPE file 1. Post the EMPDUPE with Magnetic Media Form
Check the details on the Magnetic Media Form and: Fill in the postal address (as above if appropriate) Put an X in the box next to the type of file you are sending Write a 6 Digit Identifier on the outside of the file you are sending and also write it in the space provided on the form Send the file and the form to one of the addresses at the bottom of the form, depending on the media type of your file.
Step 3: Select Lodge Step 4 Select Browse and navigate to folder of your clients payroll and select EMPDUPE file Step 5: Once the file is uploaded, tick box for AUSkey details declaration and SUBMIT
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File Status The File status - in progress screen will display after the file is uploaded and indicates it is in the process of being validated for correct file type and authorisation. The file will not be lodged if errors are detected. Once the file upload process is completed, a file reference number is provided. You can filter the report to only show Payment Summary status lodgement.
LASTLY, forward the PAYG Payment Summaries to the individual employees retaining a copy for your records.
Note: If you discover you have made an error on one of your Payment Summaries or your Magnetic Media form it is possible to fix the problem and redo the above process as long as you have not moved onto Step 6 and rolled over your file and as long as you have not sent the Payment Summary to the employee or information to the Tax Office.
You may email payment summaries to employees, however you must first receive consent from them to do so.
Payment Summaries
Payment Summaries
Payment Summaries (Note: You are required to manually create and lodge payment summaries) Payment Summaries
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End of Payroll Year PAYG Payment Summary Guide (2013) Manual Payment Summaries
You may have clients that do not have software to create payments summaries and EMPDUPE files therefore your options are 1. Use manual Payment Summaries provided by the ATO and provide employee with hand written payment summary and lodge ATO payment summary form.
2. Use manual Payment Summaries provided by the ATO and Lodge via ATO BAS Agent Portal 3. Use GovReports and create the Payment Summaries in Gov Reports, print copies for the employees and lodge via GovReports
Create and Lodge a Payment Summary Process 2. Step 1 - Log onto GovReports Step 2 - Go to client by Select Client List Step 3 - Select Client and Form - Select PAYG Annual Summary Select Step 4 Select Manual - Next. Step 5 Select Financial Year - Next Step 6 Enter Payee Details and Payroll Information for Payment Summary - Submit Step 7 Email and Print Payment Summary to employees and client Step 8 Next and Lodge EMPDUPE File Step 9 Email Client Lodgement Receipt ICB GovReports Resource link http://www.icb.org.au/Resources/GovReports GovReports Create and Lodge Payment Summary
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End of Payroll Year PAYG Payment Summary Guide (2013) Amending Payment Summaries
There are varying reasons why you would need to amend a payment summary and the following outlines just a few:
made a mistake with any of the amounts in your completed PAYG payment summary statement and you have already sent it to the ATO. have amended any of the amounts of the payment summaries issued to payees are sending payment summaries that you did not send before incorrect RESC value
There is a process that the ATO require you need to follow in sending an amended EMPDUPE file or NEW payment summary. Equally all amendments must be reported to the ATO within 21 days after providing the amended payment summary to the employee.
and
and
Current versions of MYOB and Xero are unable to create an amended EMPDUPE file, therefore our solution is to lodge the Amended Payment Summary EMPDUPE using GovReports a. Use MYOB or Xero to re-issue the payment summary to the employee/s b. Simply re-create the EMPDUPE with ONLY the payment summary that requires AMENDMENT and NOT all the payments summaries of the business. c. Access GovReports, load the EMPDUPE file and tick the Amendment Yes flag in the Step 3 of the Lodgment process in GovReports.
Alternatively Lodge the Amended Payment Summary EMPDUPE using ECI, if possible and re-issue the payment summary to the employee/s Snail Mail: Lodge the Amended Payment Summary EMPDUPE via CD/Mail d. Re-Issue the payment summary to the employee/s e. Simply re-create the EMPDUPE with ONLY the payment summary that requires AMENDMENT and NOT all the payments summaries of the business f. Burn the EMPDUPE to a CD and Label CD AMENDED Payment Summary
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To generate an amended payment summary: 1. 2. 3. 4. Go to the Employees menu and click Process Payment Summaries. Select the Tax Year (do not select any tax year prior to 2007/08). Select Generate Payment Summaries as 'Amended'. In the employees list, select only the employees that have had payment summary information amended. 5. Click OK. 6. Click Electronic File to create an EMPDUPE file and select a location to save it. The EMPDUPE file will indicate that the payment summary has been amended.
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