Salary sacrifice into super - GL treatment

Question

Hello everyone,&nbsp;I have a few employees using salary sacrifice into super in a few of my MYOB entities. I appears that salary sacrifice into super, when setup in MYOB recommended way, treats salary sacrifice as a payment deduction rather than an expense under a different GL account, so when, for example, all $X of salary is sacriced into super MYOB sets up the following entries in the GL:&nbsp;&nbsp;1-1220 Electronic Clearing Account&nbsp; 0 (CR)6-1400 Wages Expenses&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $X (DR)2-1420 Superannuation payable&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $X (CR)&nbsp;What I would like to see is -&nbsp;6-1500 Superannuation Expenses&nbsp;&nbsp;&nbsp; $X (DR)2-1420 Superannuation payable&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $X (CR)&nbsp;This would make it easier to reconcile payroll/TB/ATO reported numbers, in particular because salary sacrificed amounts are not a part of the gross wages.&nbsp;I wonder how I could setup salary sacrifice to achieve that. There is no option to select an expense account under Salary sacrifice payroll category.&nbsp;Any advice is appreciated.Mike&nbsp;&nbsp;&nbsp;

cloudmindacc · Accepted Answer

Hi&nbsp;Michael_H&nbsp;&nbsp;ATO+reporting+categories+for+Single+Touch+Payroll+reporting#expand-SuperannuationReference in support note states:Did you previously report salary sacrifice amounts on payment summaries? You don't need to assign the Gross wages category to salary sacrifice amounts. When reporting payroll amounts using Single Touch Payroll, gross wage amounts are reduced automatically by deduction amounts that are marked as a before-tax deductions. This includes salary sacrifice superannuation deductions.Note that you assign the Reportable Employer Super Contributions (RESC) category to superannuation categories which handle 'reportable' superannuation payments (as classified by the ATO guidelines).&nbsp;Below is a report that will help you review the&nbsp; Salary Sacrifice Transactions. &nbsp; You could save as a customised report so you can just run each month/quarter (changing the dates)&nbsp;&nbsp;

cloudmindacc · Answer

Hi&nbsp;Michael_H&nbsp;&nbsp;The journal entry below recorded in MYOB is correct. &nbsp;&nbsp; The Salary Sacrifice is not an expense to your business.&nbsp; The Gross Wagess is the expense.&nbsp;1-1220 Electronic Clearing Account&nbsp; 0 (CR)6-1400 Wages Expenses&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $X (DR)2-1420 Superannuation payable&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $X (CR)&nbsp;Your suggested journal below&nbsp; is incorrect and the GROSS wages must be recorded and reported to the ATO otherwise their payment summaries will be incorrect.&nbsp;&nbsp;&nbsp;

michael_h · Answer

Hi CloudMindAcc ,&nbsp;Thank you for your input.&nbsp;ATO specifically prescribes that salary sacrifice into super is not to be included into Gross payments, and requests to report it under 'Reportable Employer Super contributions' , see -&nbsp;https://www.ato.gov.au/Forms/PAYG-payment-summary---individual-non-business/?page=2&nbsp;That's why I would prefer to treat it as a Superannuation expense, rather than Salary expense.

cloudmindacc · Answer

Hi&nbsp;Michael_H&nbsp;&nbsp;Salary Sacrifice is reported under the STP ATO reporting category as Reportable Employer Super Contributions.Refer below:&nbsp;

michael_h · Answer

Hi CloudMindAcc ,&nbsp;I assume it does report correctly, and it means that GL expense of wages in MYOB is not equal to Gross Wages reported to ATO - and this is where I can see the reconciliation problem. Do you know if there any way to run a report on Salary sacrifice transactions and amounts?&nbsp;Thanks again for your help.

michael_h · Answer

Hi CloudMindAcc&nbsp;&nbsp;Thanks, this report is a workaround as the amounts could be manually adjusted in GL thus reconciled with the reported amount. [I wish MYOB would have a bit more flexibility as many other systems.]

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Salary sacrifice into super - GL treatment

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