When setting up a provision for payroll tax, please follow the steps below:
Step 1: Create an Accrual Pay Item
Admin, Structure, Pay Items, Accruals.
Add New Pay Item.
Add Code.
Create a pay item under Description - Payroll Tax Accrual.
Assign relevant GL debit and credit codes that align with your journal.
The Unit of Measure will be payment.
Roll up mode is Rate.
This is not generally shown on a Payslip.
Step 2: Create a Provision Policy for Payroll Tax
Admin, Policies, Provision, Policies.
Add New Provision Policy.
Add the Name of the provision policy, for example - Payroll Tax – Western Australia.
Description is generally the same as the name, Save.
Once created, select View.
Then select Edit.
Select Commencement Date.
The cease date is generally ongoing when creating a new policy.
Select the Rate (%), for example, the rate for Western Australia is 5.5%S.
Select the Provision Pay Item for the pay item you created in step 1, Payroll Tax Accrual.
Add Category – the Category Name is generally set up as per the reporting categories required to report under for the Office of State Revenue, for example, Western Australia, are Gross Wages & Salaries, Allowance.
Bonuses and Commissions, Termination Payments, Superannuation, Directors' Fees, Other, Apprentice & Trainees”.
Category mode is either an Addition or a Deduction. This depends on whether you want to add these pay items to the accrual or deduct these pay items from the accruals.
Add in the Applicable Pay Items that should then be included in this category. Ensure you add all the pay relevant pay items into the categories.
With provision policies, these can be set to apply to specific Employees, Roles, Departments, Projects, or Locations. For payroll tax purposes, the Locations field is used. You must ensure all locations and sub-locations are required. Populate the Applicable locations tab with the locations that need to have this policy applied.
This is always based on the Primary assigned on the employee profile.
You can also select to be included for “Apprentices & Trainees” or excluded. Apprentices and Trainees are generally included in all categories except for their own, where they are then deducted for only Apprentices and only Trainees.
Set this up for all relevant categories within the provision policy, ensuring all pay items and locations are added.
Maintenance:
When updating provision policies, ensure you use appropriate cease dates and save the version. Then create a new version with the following day's commencement date.
Make any required changes, e.g., add or remove required pay items, locations, etc.
Reporting and Important Notes:
Make sure you save as you go so the system does not time out. If it does time out, you can right click and open a new browser, log in, in a new window, revert to the prior window where you are building the provision policy, and then save.
Only when a pay run is published does the information calculated through your provision policy become available in the report. Reporting, Payroll Reporting, Provision Policy On-Cost Report.
Remember, this is for accruals purposes, which is always an estimation; the payment is the actuals. These should be as close as possible within reasonable limits.
Under Reporting, Company Reporting, Provision Policies, you can report on all the policies, categories, etc., that you have built.
Unfortunately, at this point in time, there is no way to import provision policies; this needs to be done manually. However, you can always log a consulting request for our Development team to scope importing this from the back end.