NOW THE YEAR HAS ROLLED OVER, WHAT NEXT...
Now June 30 has passed, there are administrative matters that require your prompt attention:
- Year End Payroll Procedures
Employers will need to perform an End-of-Year finalization in their software for Single Touch Payroll. This process will involve the following steps:
- Reviewing the total pay of each employee to ensure the correct amount is reported.
- Pay attention to employees that were terminated during the year to ensure the correct break up of wages is reported.
- If there is a reportable fringe benefit amount it will need to be included as part of the finalization process
- Marking as final and filing with the Australian Tax Office.
Most software providers have made this process as straight forward as possible. You are able to finalize employees one at a time so that if you need to clarify something for one employee it does not stop prevent you finalizing some others. This is particularly relevant if you wish to finalize your employees pay records but not your own. In addition, no Annual PAYG Summary is required.
Finalization must be completed by 14 July if you have more than 20 employees, 31 July if you have less than 20 employees and 30 September for those employed in their own business.
Single Touch Payroll Phase 2 is now available for those using MYOB for payroll. This will involve some additional categorization/classification in your Payroll Software prior to commencing the new reporting. In addition all MYOB files will now be required to be online if you have employees. If you need assistance with this please do not hesitate to contact us.
If you are using Xero for your payroll the software will be updated for the new reporting in August/September. We will let you know when it is ready and will be available to offer assistance to you if required.
- 2023 Financial Year Payroll Changes
The following change will need to be made in your payroll software prior to doing you first pay for 2023:
- Compulsory Superannuation must be changed from 10% to 10.5%
- ALL employees are now subject to COMPULSORY superannuation if they are under 75. The $450 per month threshold has been removed. Pleas ensure your employee records are amended to reflect this change.
If you use XERO for payroll these updates should have been made automatically in your software.
3. Taxable Payments Annual Report (TPAR or Contractors Statement)
The Taxable Payments Annual Report must be prepared by any business in the following sectors:
- Building and Construction Services (including services peripheral to this industry such as trades, floor coverings, air conditioning, architecture etc.)
- Cleaning Services
- Courier Services
- Road Freight Services
- Information Technology Services (IT)
- Security, Investigation and Surveillance Services
- Mixed Services (if you supply to one or more of the services listed above, this will include such things as florists who pay delivery drivers, event management teams etc.)
- Government Entities/Services
The information to be provided is the Contractor name and address, ABN and the gross amount you have paid them including GST. Reports need to be made in a specific format. We have paper copies of the relevant form available or alternatively it can be lodged via Online Services for Business https://onlineservices.ato.gov.au/business or via our Tax Agents Online facility.
These reports must be lodged by 28 August 2022.
- Superannuation Payments
Superannuation for the June quarter MUST be paid by July 28. There are no extensions and failure to pay by the due date will require lodgement of a Superannuation Guarantee Charge Form with the Australian Taxation Office. This will incur penalties and interest. If you have not received the Superannuation details from an employee in time for the payment you must make the payment to your default fund and notify them.
If you paid your June quarter super prior to the end of June there will be no payment required by 28 July.
- Business Activity Statements
Business Activity Statements are due 28 July if you are preparing yourself or in August if we are preparing on your behalf.
Your annual payroll should be finalised and reconciled prior to lodgement to ensure you can make any adjustments in the appropriate BAS. In addition, if you have offset your FBT liability by employee contributions these should be included in your June BAS.
- Odometer Readings & Motor Vehicle Log Books
Odometer readings should be recorded for all vehicles at 30 June. If you are depending on a Log Book for claiming vehicle expenses please ensure it is up to date (4 years old or less, no change in use) and available if the ATO requests it.
- Payroll Tax
If your business pays wages of more then $1,200,000 in NSW you will be subject to Payroll Tax. This threshold includes wages, superannuation, allowances, and fringe benefits tax. The payroll tax return is due by 30 August 2022
If you employ staff in other states, your payroll tax threshold will be adjusted to reflect those wages and the applicable payroll tax threshold in that state. We can assist you in this calculation if required.
As always if we can be of assistance do not hesitate to contact us.