This section of End of Year preparation is to get you thinking about Allowances.
In Wagemaster, Allowances refer to functionality handling both additions and deductions to an employee’s pay. The latter is sometimes referred to as deduction allowances.
Allowances that have been selected to be separated in ATO payment summaries are not added into the Gross total on the ATO Payment Summary Report. Allowances appear separately on the ATO Payment summary for claiming individually by employees when lodging their tax return. It is therefore very important to only show those qualifying allowances separately on the ATO Payment summary and not all allowances paid to employees.
Any other Allowances that were set up and ticked as a Taxable Allowance, will automatically have the value paid or deducted incorporated into the Taxable Gross figure of Employees who have been paid this Allowance throughout the Financial Year (unless you select them to list separately on the ATO Payment Summary).
Please consult your Accountant for advice on which Allowances may need to be separated for ATO reporting in the Allowances area.
NOTE: This financial year-end you will have to be aware of how your Wagemaster Allowance configuration must meet the needs of traditional ATO Payment Summaries but also changes associated with STP Reporting in the new financial year.
Settings for ATO Payment Summaries
Setup > Allowances > (Edit an Allowance) > ATO Payment Summary
These setting will still be in place from last year so your focus will be on any Allowances created since last year, or perhaps any missed for attention at that time.
Settings for STP (Single Touch Payroll) Reporting in the new financial year
For STP Reporting, the ATO requires Allowances which are reported separately to the employee's individual non-business Gross amount, to be categorised according to a pre-defined list of ATO Types.
You will find fields at the base of the Allowances window associated with STP.
They are the Report in STP tick box and the associated ATO Type field.
The same functionality can be applied to deduction allowances for Workplace Giving.
If you are planning to produce ATO Payment Summaries this year, you will still need to configure
the original fields at the top of the window so that they offer consistent reporting.
The example shown above therefore complies both with the old Payment Summary standard and the new STP Reporting standard.
A report explored in Step 12 relies on configuration within the employee record to properly display
Allowances on Payment Summaries and so via the ATO Payment Summaries Report. Navigate to
an employee file the Payments > Allowance. Ensure that each qualifying Allowance is marked to
be included in ATO Payment Summaries and so on the ATO Payment Summaries Report.
Consult your Company Accountant for advice on which Allowances may need to be separated in
STP Reporting and on the ATO payment summary in the Allowances area.