How to generate PAYG payment summaries - MYOB Essentials Accounting - MYOB Help Centre

Fill in the employee's personal information, including their Tax Identification Number (TIN).

If you have already entered their address into MYOB Essentials, you may need to reformat it in order to conform to the specifications set forth by the ATO.

When you are finished, click the Next button.

Pick the kind of payment summary you want and the range of dates it includes.

It is important to keep in mind that you should only generate an amendment if you need to make changes to a payment summary that you have already submitted to the ATO. If you are making modifications to a payment summary that you haven't lodged yet, you should select the option that says "No, this is a new PAYG summary."

Time spent on the job by the employee

Choose the option "Yes" if the employee worked for you throughout the entire reporting period. Choose "No" if they were only employed by you for a portion of the year, and then specify the dates for which they were on the payroll.

When you are finished, click the Next button.

Put each of the employee's earnings and deductions that were paid to them throughout the course of the fiscal year into one of the following categories. As a result, you can rest assured that they will be included in the appropriate section of the PAYG payment summary.

Earnings

Earnings can be placed into one of three categories, depending on the nature of the allowance or the reason for the payment.

• Amounts that are counted toward an employee's total gross pay and are deducted from that pay before taxes are taken out. Allowances paid for working conditions, special qualifications, or extended hours, or to cover expenses that aren't tax deductible, such as transportation between work and home, are included here. This includes salary, wages, bonuses and commissions, personal leave pay, and allowances paid for working conditions, special qualifications, or extended hours. If you've made any of these payments using an allowance, you need to make sure that the allowance is accounted for as gross income. You may have, for instance, allotted a certain amount in MYOB Essentials for the purpose of paying commissions. Because commissions are not considered to be allowances for the purposes of taxation, but do need to be included in the employee's gross pay, you should assign this allowance to the Gross pay category.
• Allowances are amounts paid to employees in addition to their regular pay in order to reimburse them for costs directly related to their jobs. This includes reimbursements for travel, uniforms, and tools, as well as reimbursements for motor vehicle expenses and payments made on a per-kilometer basis for car expenses.
• Amounts that do not have to be included in the PAYG payment summary that are designated as "Exclude." Allowances for ancillary benefits, such as a living-away-from-home allowance, could fall under this category.

Deductions

Depending on the kind of deduction you have, you can put it into one of these four categories:

• Employer super refers to reportable superannuation contributions made by employers. These contributions can include salary sacrifice amounts, additional payments to superannuation, or additional contributions above and beyond the mandatory level. Take note that this does not include the typical contributions made by employees or employers to their superannuation accounts. Gain a better understanding of the Reportable Employer Super Contributions.
• The term "union fee" refers to the money that is taken out of an employee's paycheck to pay for union, association, or professional fees.
• Donations made in the workplace that are eligible for a tax deduction and that have been authorized by an employee to be made to recognized charities or organizations that are qualified to receive such donations are known as "workplace giving."
• Those amounts that are exempt from being included in the PAYG payment summary are designated as "excluded." This includes some deductions that are requested by the employee on a voluntary basis, such as membership dues to social clubs or cafeteria plans.

Visit the website of the ATO for more information about how to appropriately categorize individual earnings and deductions.

Click the Next button once you have finished allocating your earnings and deductions.

This step lists all of the earnings and deductions that are included in each category (the parts of the payment summary, such as Gross payments and Total allowances, etc.). For example, this step may list gross payments and total allowances. ) Verify that these have been given the appropriate names.

You can change the category an earning or deduction is assigned to by going back to step 3 (click Edit assignments) and assigning it in a different way. If the category an earning or deduction is assigned to is incorrect, you can change it.

Please take into consideration that any earnings or deductions that have been assigned to the Exclude category will not appear here. On display are only those categories that will be included on the final payment summary.

When you are finished, click the Next button.

Include any additional income that was paid to the employee that was not tracked by MYOB Essentials on their payment summary by entering it in this step. Doing so will ensure that it is properly accounted for. Visit the website of the ATO for further details regarding these classifications.

Input the following amounts, making sure to use whole dollars:

• Payments from Community Development Employment Projects (CDEP) are the total amount of a CDEP wages grant that you have paid to an employee.
• Reportable fringe benefits are defined as the total cost of the employee's taxable benefits after they have been grossed up. Take note that employees are only required to report fringe benefits if the total taxable value of those benefits is greater than the threshold established by the ATO.
  If you have indicated in your payroll settings that your company is subject to Section 57A of the Fringe Benefits Tax Assessment Act of 1986, then you will see two fields: Reportable fringe benefits (non-exempt)—The grossed-up value of reportable fringe benefits that are not exempt by section 57A; and Grossed-up value of reportable fringe benefits that are exempt by section 57A. Grossed-up value of reportable fringe benefits that are exempt from section 57A reporting requirements and are considered reportable fringe benefits.
• A portion of the employee's contribution to the purchase price of any non-superannuation annuities or pensions you pay them is tax deductible. This portion of the employee's contribution is referred to as the "deductible amount of the undeducted purchase price of the annuity." The portion of their annual pension or annuity income that represents a return to them of their personal contributions and that is exempt from taxation is the amount that is considered to be the deductible amount. In this section, you are only required to enter the deductible amount.
• Redundancy or termination payments made to the employee during the course of the fiscal year are referred to as lump sum A. Choose either the payment for voluntary redundancy or the payment for termination.
• Payments made to the employee in exchange for long service leave accumulated prior to August 16, 1978 are referred to as lump sum B.
• The portion of an early retirement scheme payment or redundancy payment that is not subject to taxes is referred to as the lump sum D.
• Amounts paid for back payment of salary and wages accrued more than a year ago, in addition to any return to work payments that may have been made. These amounts are referred to as lump sum E (back payments).
• Exempt foreign employment income refers to money earned working abroad that is not subject to taxation. Visit the website of the ATO for further information.

When you are finished, click the Done button. Next employee

After you have completed the review of the last employee, click the Continue to Review button and then enter the authorized signatory for the summaries. The page that displays a summary of the amounts that are included on each employee's PAYG payment summary is referred to as the Review payment summaries page.

Look at the activity down here.