Version 2016.06 introduced the ability to adjust the amounts and payment types reported on the PAYG payment summaries.
Once a payment to an employee has been generated via a dividend, through the pay employee wages function, or via an ad-hoc payment, the amounts being reported on the payment summaries can be adjusted in the cashbook payment entry.
In this example, the employee has received a dividend in respect of wages and retrenchment.
Right hand click on the claim coding line to edit the PAYG coding
The PAYG Edit/View Form appears allowing you to edit the PAYG coding.
Note: This option only appears for Payroll accounts or Preferred (Employee) Creditor Claim Accounts.
You may change the coding type and the gross and tax amounts. You can also split the PAYG coding up by adding additional line items. You should note the following:
- The taxable amount must equal the actual amount paid against the claim. If you split the elements up, the total of the tax for each of the line items must equal the total paid against the claim.
- The total of the tax amounts must equal the total of the amount coded against the PAYG withholdings account for the transaction. It is possible to increase or reduce the tax amount withheld from one claim type to another claim. In this example if you were to increase the tax withheld against retrenchment by $5 and click save and exit on the coding form, you would receive the following warning:
The total of the tax amounts entered in the PAYG tax detail do not equal the total tax amount being withheld.
The warning is green in order to allow you to continue on and edit the amount withheld against the wages claim. If you were to attempt to save the record before amending the wages claim, the green validation above would change to red and you would not be able to save the record.
Note that you can also amend the total tax amount withheld in the withholding account coding line, in which case you would need to adjust the claim PAYG detail amounts as per the example above. Generally though, dividends require the total of the transaction to be locked, so this type of adjustment cannot be made for dividends, but is possible for ad-hoc payments and entries generated through pay employee wages.
Note that the tax amount in the detail is rounded to 0 decimal places, however, you may receive validation asking you to match a tax withheld amount with 2 decimal places. In this case enter an amount to 2 decimal places and even though the amount will appear rounded in the display, it will save with 2 decimal places and pass the validation.
For information on Employment Termination ETP codes please click here for the ATO link.
An explanation of the codes on the PAYG payment summary are explained in the PAYG Payment summary - individual non-business attached to this article. This example was downloaded from the ATO website on 6 April 2021.