Subcontractor Super through Payroll

SharonSL

Hi,

I've paid subbie invoices and their super manually for years.

I've read that I can pay their super through payroll so I thought I'd give it a try however, even though I select 'Other (Not Reported)' for the Employment Basis the system still requires - Pay Basis of Salary/Hourly, Hours in Weekly Pay Period and an Annual Salary/Hourly rate, but these don't apply for a subcontractor. The posts I've read about paying subbies through super don't mention these issues. I've tried the setup on my desktop version as well as online. Am I missing something? I'm assuming their Bill still goes through as a Purchase, it's just the super that's entered.  Also, do I create a new super category? Can someone please help?

Thanks.

Earl_HD

Hi @SharonSL,

Great question, and you’re on the right track wanting to run the subcontractor’s super through payroll.

Because the ATO now expects contractor super to be reported via STP2 when the software supports it, you’ll need to set the subcontractor up as an employee for super-only using Labour hire (not Other – not reported) as the employment basis, and then either use your existing Superannuation Guarantee category or create a separate Subcontractor Super category if you’d like to track their super separately.

You can keep using your existing Superannuation Guarantee category, or create a separate “Subcontractor Super” category if you want to track their super separately, and it’s always best to confirm with your accountant or the ATO that super is required for this subcontractor and that Labour hire is the correct STP income type for their situation.

Regards,
Earl