A Guide to Jobkeeper – Infographic
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BAS Agent’s Blog
The “Boosting Cash Flow for Employers” payment (PAYGW Boost Credit)
As part of the economic stimulus triggered by the Corona Virus pandemic, the Federal Government has introduced the “Boosting Cash flow for Employers” measure or as we like to call it, the PAYGW Boost Credit. This measure promises to “refund” the PAYG withholding reported on the BAS or IAS by employers back into their integrated client accounts (ICA) as an offset against any existing BAS/IAS debt. To be clear, this is not a supply of cash to employers into their banks. This is simply crediting PAYGW back into the ICA to effectively reduce BAS/IAS debt. The only time an employer will see any cash is when a refund is created because the PAYGW credit is more than the whole activity statement debt. So who gets these payments, how much do they get and how do they get it? Read on to find out!
WHO IS ELIGIBLE?
Businesses will be eligible for this stimulus measure if they:
- Held an ABN on 12 March 2020 and continue to be active
- Are a small or medium business including NFP, sole trader, partnership, company and trust entities.
- Have an aggregated turnover under $50M
- Have made payments from which they have been required to withhold (even if this a zero amount). Such payments may include salary and wages, director’s fees, eligible termination payments, compensation payments and withholding from contractor fees.
- Have made GST taxable, GST free or input taxed sales in a previous tax period since 1 July 2018 and lodged a relevant BAS on or before 12 March 2020.
HOW MUCH IS PAID?
PAYG withholding amounts will be credited back to the integrated client account (ICA) of between $20K and $50K. These credits are not income and as such will not be taxed. The do not have to be repaid ever. The good thing is that the PAYG withholding you report on your BAS will still be tax deductible. Note, if you have a tax debt on your ICA, the credit boost amount will simply pay down that debt.
HOW IS IT PAID?
These credits will be applied in two stages to integrated client accounts after 28th April 2020 and after the March 2020 quarter or monthly BAS is lodged. You do not have to apply for this measure, AND you do not receive any actual cash – this is credit only, not cash paid to your bank. The second stage credit will be applied in quarter 1 of 2020-21.
HOW DO THE PAYMENTS WORK?
Put simply, there are 2 payment stages for this measure. The first stage is a payment of up to $50K based on the amount of PAYGW reported on the March 2020 BAS. Examples below:
Quarterly Lodgers
If your March 2020 BAS shows a PAYGW amount of $12,000, this amount will be credited back to your ICA. In your June 2020 BAS, if a $14,000 PAYGW is reported, then this will also be sent back to the ICA. So far, a total of $26,000 has been credited. This is the first stage amount. The second stage amount will be the same as the first one i.e. $26,000 and will be credited to your ICA split evenly across June to September 2020.
Monthly Lodgers
If your March 2020 BAS shows a PAYGW amount of $12,000, this amount is multiplied by 3 (to take up amounts for January and February 2020) to give you a credit of $36,000. April, May and June 2020 BAS’s will continue to be lodged which may or may not total more than $50K. For this example, let’s say April was $10,000, May was $8,000 and June was $6,000. This will be a total PAYGW of $60,000. As the first stage payable can be no more than $50K, then $50K is all that will be credited to your ICA. The second stage payment will also be $50K.
What if my PAYGW is less than $10K or zero in my March 2020 BAS?
In this case, you will be credited $10K in the first stage of credits and another $10K in the second stage for a total of $20K.
PAYGW Boost Credit Calculator
Here is a great calculator to assist you to work out how much your PAYGW boost credit might be: https://digit.business/payg-cashflow-boost-calculator-advanced
The “Boosting Cash Flow for Employers” payment (PAYGW Boost Credit) Read More »
JobSeeker Payment
The JobSeeker payment will be delivered by Centrelink, now known as Services Australia. It is a new payment designed to assist those who have lost their jobs or had had their income reduced due to the COVID-19 pandemic.
Here are the details about this payment:
- To be eligible, you must be between 22 and Age Pension age (those under 22 may be able to claim Youth Allowance).
- You must be a permanent employee who has been stood down or lost your job, a sole trader, self-employed, a casual or contract worker whose income has reduced, or caring for someone who has been affected by Coronavirus.
- To register you intent to claim for this payment, you do not need to go to Centrelink. You can do this via your MyGov account (ensure you are linked to Medicare, ATO and/or Centrelink).
- When you log into MyGov, you will be prompted to register your intention to claim the JobSeeker Payment.
- After registering, you will be contacted (in time) to complete your application for this payment.
- Income testing may apply (see below).
- If you are receiving payments for annual or sick leave or income protection insurance, you will not be eligible for JobSeeker payment until those payments have ceased.
- You will be required to look for work whilst on JobSeeker payments, however, this requirement has been temporarily lifted up to and including Friday 22 May 2020.
- Sole traders and self-employed people now earning less than $1,075.00 per fortnight will not have to look for work whilst on JobSeeker payments as long as they continue to operate their businesses. Note, JobSeeker payments are income tested. If your partner earns more than $79,762 a year, you will not be eligible for JobSeeker.
- Payments will begin on April 27 and will be available for at least six months.
COVID-19 and Payroll Tax
During the Corona Virus pandemic, the following states have decided to either waive or defer payments of payroll tax. See below for further information.
VICTORIA
For those businesses with a payroll of less than $3M, payroll tax for the whole 2019-20 financial year will be waived.
Also on offer is a deferral of payroll tax payments for businesses as above for the first 3 months of the 2020-21 financial year.
The State Revenue Office will contact eligible businesses by email to advise them about how to apply for the waiver of payments.
NSW
For businesses with payrolls up to $10M, payroll tax will be waived for 3 months, plus another 3 month deferral.
For businesses with payrolls over $10M, payroll tax will be deferred for 6 months.
In the 2020-21 financial year, the payroll tax threshold will be raised to $1M, bringing forward payroll tax cuts.
WA
For businesses with Australia-wide annual wages of less than $7.5M, payroll tax will be waived from 1 March to 30 June 2020.
The payroll tax threshold will increase to $1M from 1 July 2020.
TAS
If a business with a payroll up to $5M can demonstrate negative impact by COVID-19, payroll tax will be waived for the April-June 2020 period.
Businesses in the hospitality, tourism and seafood industries will have their payroll tax waived for March to June 2020.
If a business employs a person aged 24 of less between April and December 2020, they will receive a payroll tax rebate.
QLD
For businesses with payrolls less than $6.5M, payroll tax will be refunded for November and December 2019. Also, payroll tax will not be required to be paid for the January to March 2020 period.
For businesses with payrolls more than $6.5M, payroll tax will be refunded for January and February 2020.
Government is also offering a payroll tax deferral for the 2020 calendar year but this is only by application.
NT
Government has extended the payroll tax exemption for hiring Territory employees to 30 June 2021.
ACT
All businesses required to close due to COVID-19 will receive a payroll tax waiver from April to September 2020.
Businesses with group Australia-wide wages of up to $10M will have their payroll tax deferred for 2020-21 until 1 July 2022.
Building and construction businesses will receive a deferral of payroll tax for the period April to September 2020.
SA
Businesses that can demonstrate significant impact by COVID-19 which have payrolls over $4M, will have their payroll tax deferred for the period April to September 2020.
COVID-19 and Payroll Tax Read More »
Employing staff and Coronavirus: Fairwork directions
Coronavirus (COVID-19) has brought with it great uncertainty and worry amongst the general population, not the least of these, employers and staff. There are many unknowns relating to how to manoeuvre in these difficult times as an employer, especially in terms of ensuring staff are treated correctly and fairly. Recently, Fairwork released some direction for employers on their website. We advise you read the bulk of the details on their page yourself but we do provide a “taste” of the information provided below.
My employee (or his family member) has Coronavirus. What now?
You must direct the employee not to come to work and to only return when s/he has been given medical clearance. If the employee is part or full time, s/he will be able to take paid personal/carers leave. Casual workers will need to take unpaid leave given they do not receive leave entitlements. Workers refusing to use their leave entitlements are not required to be paid. You can ask the employee for evidence of the illness or emergency i.e. doctor’s certificate if required.
My employee wants to stay home to avoid contact with others.
In this case, you need to discuss this with the staff member and come to an agreement that suits you both. If working from home is an option and your staff member agrees to do so, then make arrangements together to ensure this can occur easily and smoothly. If the employee cannot work from home, then you must decide if paid or unpaid leave will be provided. Where an employee refuses to take paid leave (where it is available), then that employee cannot be paid.
I want to tell my employee/s to stay home.
From Fairwork: ” Under workplace health and safety laws, employers must ensure the health and safety of their workers and others at the workplace as far as is reasonably practicable. ” If you believe that it would be best to instruct your staff to stay home due to possible risks from COVID-19, then you certainly can do so. You can organise a “work-from-home” scenario where possible or if not possible, you can direct staff to remain off site but you must be aware as per Fairwork ” where an employer directs a full-time or part-time employee not to work due to workplace health and safety risks but the employee is ready, willing and able to work, the employee is generally entitled to be paid while the direction applies”, and also “standing down employees without pay is not generally available due to a deterioration of business conditions or because an employee has the coronavirus.”
I want to direct staff not to travel.
While you can direct your employees not to travel for work-related events, meetings etc because you want to reduce the risks associated with COVID-19 at your workplace, you cannot ask them to cancel personal travel/trips.
So, in summary, you need to ensure your workplace is safe and you can do this by keeping unwell employees at home and/or all staff at home if required. If your business is structured in such a way that working from home is possible, then certainly bring that to the table and discuss with staff how best to handle that scenario. Part and full time staff should take personal leave if affected by the virus or unpaid leave if they prefer. Similarly, if staff unaffected by COVID-19 request to remain at home and also cannot work from home, they must opt to take annual or unpaid leave. If you direct staff to stay home and there isn’t any evidence that they have been affected by COVID-19, that is, they are well and able to work, then you must continue to pay them as normal. To read the full list of instructions provided by Fairwork, download their factsheet below.
Employing staff and Coronavirus: Fairwork directions Read More »
Super Amnesty – Yes? No? Maybe!
Back in May 2018, the first iteration of a law for an amnesty on unpaid historical superannuation was announced, but due to the calling of the Federal election at the time, it did not pass. A second iteration of the law, known as the “Recovering Unpaid Superannuation” Bill, was launched in September 2019. This second attempt was given the green light by the Senate Economics Legislation Committee in November 2019. The Bill is yet to receive royal assent, but if achieved, will mean that many employers will be given the chance to self-report their non-compliance and avoid the usual penalties as a reward.
What does the new Bill include?
The second iteration of the Bill to recover unpaid super includes the following:
- The period of historical reporting is from 1 July 1992 to 31 March 2018.
- The amnesty period will be for 6 months from the date of royal assent.
- Employers must self-report to be eligible to partake in the amnesty.
- Payments of super made during the amnesty will be tax deductible (note, usually late super payments are not tax deductible).
- Administration fees associated with reporting later super to the ATO will be waived.
- Interest charges will still apply.
But will it pass?
While the recent thumbs up by the Senate Committee is a step closer to the Bill being passed, there is still a way to go mainly because Labor Senators don’t agree with the Bill. They cite that this will give non-compliant employers an unfair advantage over employers who are doing the right thing. They don’t agree that the payments should be tax deductible or that fees be waived as this sends the message that being non-compliant is “okay” and will be forgiven, even rewarded. Further to this, those employers who usually pay on time but who may err occasionally, will still be subject to all super guarantee penalties and will not enjoy any tax deductions given the amnesty does not apply to any pay period post 1 January 2018. Labor do not support the Bill due to it giving rise to this unfair playing field. They believe the Bill rewards those employers who have been non-compliant for breaking the law.
We aren’t sure what will happen, but given Parliament will not sit now until February next year (2020), nothing will go ahead until then. If the Bill is passed, we will be sure to let you know and also how we can assist you if you are an employer who would like to take advantage of the amnesty. Please note, we certainly won’t cast any judgement on you if you are in this predicament and you come to us for help. While Labor has a point, we are in favour of any vehicle that will put money that is owed to employees back in their pockets – after all, it is their money! Watch this space – we’ll update this blog if/when the Bill is passed.
Update! SG Amnesty Bill passes Parliament so it is definitely a YES!
As of 24th February 2020, the “Recovering Unpaid Superannuation” Bill 2019 has been passed in both houses and is awaiting royal assent. At that point, the amnesty period will start from 24th May 2018 and end six months from the date royal assent is received. Employers will be able to self-disclose non-paid historical superannuation for past and present employees. It is noted that if employers do not voluntarily disclose their historical SGC debt during the amnesty, they will face significantly higher penalties if the ATO conducts an audit. So, if you are an employer in this situation, you are best to contact your tax adviser ASAP and make arrangements to take advantage of this amnesty because it’s a once-only offer from the ATO – I doubt we’ll ever see it again.
Super Amnesty – Yes? No? Maybe! Read More »
How to set up STP in your accounting software – part 4 – QuickBooks Online AU
If you’re a small employer with 19 employees or less, you had until 30 September 2019 to connect your accounting software to the ATO for Single Touch Payroll (STP) purposes. That date has come and gone but if you still haven’t connected your file for STP, it’s not too late! In this four-part series, we aim to help you by showing you how to enable STP in your file. We began the series by looking at enabling STP in Xero, MYOB and Saasu. Today, in the fourth and final blog in this series, we will cover QuickBooks Online (QBO).
Connecting your QBO file for STP
1. Setting up ATO Supplier Settings
The first step in enabling STP in your QBO file is to make sure your ATO supplier settings are correct. To check this, go to Employees, then Payroll Settings, then ATO Settings. Next, select “I will be lodging reports to the ATO as the employer” (choose one of the other options if you aren’t the employer)
Now you need to complete the form on this page or if you’re in a hurry, you can simply scroll to the bottom of the page and select “Copy from Business Settings” and then all details will populate as if by magic!
2. Enabling STP and Electronic Lodgement
To enable STP in QBO, you must first enable electronic lodgement. Do this as follows:
- Select Employees in the left-hand menu
- Select the Payroll Settings tab
- Select ATO Settings
- Select the Electronic Lodgement & STP tab
- Contact the ATO on 1300 852 232 and provide them with your Software Provider and Software ID or Update your details through Access Manager
As a tip, your Software Provider is “KeyPay”, not QBO! Also, your Software ID number is shown on the Electronic Lodgement page. While you can call the ATO as above, the easiest way to update the ATO with your STP details is via Access Manager. To do this follow these steps:
Log in to Access Manager using your myGov credentials if you are the eligible associate or authorised staff of the business and follow these steps:
- Select My hosted SBR software services from the left-hand menu;
- Select Notify the ATO of your hosted service
- Search for KeyPay in the list, or alternatively search by entering KeyPay
- Select the ABN link for KeyPay
- Enter the software ID and select Next
- Read the Notification statement then select Save. A green success message will appear on the next screen to confirm success.
The final part of set up is to select “Enable Electronic Lodgement” and then “Enable Single Touch Payroll”, then select “Confirm”. At this point you are done and can start reporting your payroll to the ATO at each pay run or as the ATO like to call them “Pay Events”.
We hope you have enjoyed this four-part blog series about enabling your accounting files for STP and that it has assisted you to get the job done! As per usual, if you are having difficulty getting connected, please do not hesitate to contact us – we’d be happy to take a look for you!
How to set up STP in your accounting software – part 4 – QuickBooks Online AU Read More »
How to set up STP in your accounting software – part 3 – Saasu
If you’re a small employer with 19 employees or less, you had until 30 September 2019 to connect your accounting software to the ATO for Single Touch Payroll (STP) purposes. If you haven’t yet done so because you simply don’t know how to do it, then this blog is for you! This is a four-part series and we began the series by looking at STP and Xero software and MYOB. Today we will review STP and Saasu. In the final part of this series, we will also cover QuickBooks Online.
Connecting your Saasu file for STP – or perhaps not!!
Saasu’s set up process for STP is probably the easiest of all the accounting software because there isn’t one – that’s right, you read right – there isn’t one! As per Saasu.com – “There are no special settings that you need to enable STP in Saasu. It will be available on all files and the authentication with the ATO is done behind the scenes.”
In order to get ready for STP, all Saasu ask of you is that you review your current payroll and company set up and ensure the following is in place:
- Confirm employee information is accurate – including name, address (including postcode), main phone number (including area code and no spaces), date of birth, and gender, on the Employee Details page (View > Employees > click ‘View or Edit Employee Details’ icon)
- Confirm that your ABN or Withholding Provider Number (WPN), address (including postcode and state is in short form (i.e VIC, QLD etc) , and phone number (including area code and no spaces) is entered on the File Identity page (cog icon > Settings for this file > File Identity)
- Check your payroll processes and ensure your pay items are correct and you are paying staff properly. Especially check pay items like allowances and deductions.
- You must be using the payroll function in Saasu rather than entering payroll information via journal otherwise STP reporting will not work.
Once you have reviewed the above and are satisfied that your set up is adequate, then you are ready to report your first payrun to the ATO via STP – easy huh!
Reporting your payrun to the ATO
This following is taken from the Saasu website.
- Process your regular pay run
- Click on Reports > Single Touch Payroll
- Click on the cog icon, select Regular Pay Event, specify the report settings and click Run
- The data that matches your settings will be displayed and can be checked for accuracy
- Ensure that pays to be submitted are ticked (pay runs will be pre-ticked and can’t be modified), then click the Upload icon
- Before the report is submitted to the ATO you will need to authorise the submission by agreeing to “Sign declaration with my email address” (this is the email address you are signed into Saasu with) and click Submit
- The ATO has a standard response time of up to 72 hours before the upload is accepted and successful. At times, this may be quicker and could be as little as 10 minutes. You can move away from this screen and continue to work on other things in Saasu while the STP report is being processed.
Remember to come back to the Single Touch Payroll Report screen (Reports > Single Touch Payroll) about 10-15mins after you have submitted a regular Pay Event. This is to ensure the submission has been accepted by the ATO, and there are no errors that need further attention. If you haven’t moved away from this screen then you may need to refresh your browser to see the updated information.
Note: Once a Pay Event has been submitted to the ATO, you cannot submit any further Pay Events until the previous submission has been accepted or, if rejected, the submission result actioned.
So there you have it – there isn’t really any major set up of STP for Saasu which makes it very easy for users to comply with STP requirements. I must say I am a fan of this scenario given that other software do involve many more steps to enable STP connection which can be frustrating for users. Keep it simple stupid I say! In our final blog in this series, we will look at how to connect STP in Quickbooks Online.
How to set up STP in your accounting software – part 3 – Saasu Read More »
How to set up STP in your accounting software – part 2 – MYOB AccountRight
If you’re a small employer with 19 employees or less, you have until 30 September 2019 to connect your accounting software to the ATO for Single Touch Payroll (STP) purposes. If you haven’t yet done so because you simply don’t know how to do it, then this blog is for you! This is a four-part series and we began the series by looking at STP and Xero software. In subsequent blogs we will also cover Saasu and QuickBooks Online.
Connecting your MYOB file for STP
Before the connection of the file to ATO happens, MYOB will ask you to verify that your payroll details, including employee setup, are correct. To begin, go to the Payroll Command Centre and click on “Payroll Reporting”. You will be directed to the “check payroll details” window which will list any anomalies MYOB has found which may inhibit STP connection.
Click on the arrow next to each error and fix the error as needed, then click on “check payroll details” again. If no further errors are found, then you are ready to connect to the ATO.
NB! ATO reporting categories need to be assigned to all of your payroll categories which you are reporting before you use STP. The above check will highlight which payroll categories need to be assigned an ATO reporting category.
To connect, click on “Payroll Reporting”.
Now click on “Connect to the ATO”
If you are the business owner and you will be processing payroll and lodging the payroll via STP, then follow the below directions:
- Make sure you have your ABN handy.
- Where you are asked for your role, choose “Someone from the Business”
- Enter your declarer information including ABN, name, contact details etc.
- Skip the “Add Clients” step.
- At the “Notify ATO” step, you will need to provide the ATO with the Software ID number which will be shown to you in the next screen.
- To give the ATO that special number, you can either call the ATO on this number 1300 85 22 32 or you can notify via Access Manager. You can find Access Manager either in your Business Portal or in your myGov account.
Once you’ve notified the ATO that you are using MYOB software, click on “I’ve notified the ATO” and in the message that appears, click “I’ve notified the ATO”.
If you’re a Tax or BAS Agent who will be processing and lodging payroll on behalf of a business, do exactly the same as above, however for the choice of role, choose “Tax or BAS Agent” and enter your own ABN and registered agent number. You will need to add the client in the “Add Clients” step if they aren’t already in your portal client list. Then note down the Software ID presented to you (note, this number is unique to you – you cannot use your client’s ID and they cannot use yours). Notify the ATO of your ID number as per above. Again, once this is done, you will need to click “I’ve notified the ATO”.
And as Porky Pig would say, “Th-th-th-that’s all folks!” It’s as simple as that. Of course, if you don’t find this as simple as it should be, don’t be shy, give us a call and we’ll see if we can help you out.
In the next blog, we’ll look at how STP is connected in Saasu (or not, as the case may be….). Intrigued? Don’t forget to check in and take a read to find out what we mean!
How to set up STP in your accounting software – part 2 – MYOB AccountRight Read More »
How to set up STP in your accounting software – part 1 – Xero
If you’re a small employer with 19 employees or less, you have until 30 September 2019 to connect your accounting software to the ATO for Single Touch Payroll (STP) purposes. If you haven’t yet done so because you simply don’t know how to do it, then this blog is for you! This will be a four-part series beginning with Xero software. We will cover Saasu, MYOB and QuickBooks Online in subsequent blogs.
Connecting your Xero file for STP
Before proceeding with the connection, it is advised that you review and update your organisation details and also all employee details like dates of birth, tax file numbers and residential addresses. It is also advised that you check your payroll set up especially pay items and ensure they are correct. Your tax professional can assist with this if necessary.
Here are the steps you need in order to connect:
- In the Payroll menu, select “Pay employees”.
- In the message about Changes to the way you report payroll information to the ATO, click “Get started”.
If you don’t want to opt-in right now, close the message by clicking Remind me later. To reopen the message, click Setup Single Touch Payroll. - Click Opt-in to confirm.
- Review your organisation details. If necessary, click Update Organisation details. Xero will redirect you to the Organisation details page. Otherwise, click Continue.
- To connect your Xero account to the ATO, call the ATO on 1300 852 232. If you use the ATO business portal or have a myGov account, you can also log into Access Manager and nominate Xero as your software service provider there – a bit easier than calling the ATO!
- Provide the ATO with the proof of ownership listed in Xero’s prompt, including your Australian Business Number (ABN) and Software ID (SSID).
- Select the checkbox to confirm you’ve contacted the ATO to connect your Xero account.
- Click Register.
Xero will redirect you back to the Pay employees page. You’ll now see an STP filing column in the Pay Run History table.
Once you’re set-up, the option to report a payment to the ATO will be presented for each pay run and your payroll information will be filed with the tax office each time.
I need more information
No problems! Here is the link to the Xero blog about connecting for STP – includes details for business owners and tax professionals connecting on their clients’ behalf.
In part 2 of our blog series, we will look at how to connect MYOB software for STP purposes.
How to set up STP in your accounting software – part 1 – Xero Read More »