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CSSAUS's avatar
CSSAUS
Experienced Cover User
4 years ago
Solved

Base Salary vs Gross wages

With AccountRight Payroll, what is the difference between Base Salary & Gross Wages?

 

Under Payroll Categories, "Base Wages" is listed as a wages payroll category but "Gross Wages" isn't. Both "Base Wages" and "Gross Wages" can be used as a calculation basis for Superannuation Guarantee.

  • Steven_M's avatar
    Steven_M
    4 years ago

    Hi CSSAUS 

     

    Base Salary is a wage payroll category like overtime or holiday pay. Gross Wages would be a collection of payroll categories i.e. base salary, overtime, and holiday pay could be counted as gross wages.

     

    In terms of superannuation category calculations, when you have it set to be Base Salary you would only have the amount calculated on that particular category. So any amounts paid through other payroll categories like overtime or holiday pay would not be included in the calculations. However, if it is set to be Gross wages it could be set to include Base Salary, overtime and/or holiday pay.

     

    If you do have a calculation basis set to be Gross Wages, the Exempt button will be selectable on the Superannuation Information window. Anything that is ticked in here would be exempt from being calculated. For example, say you want to include all wage categories but not include overtime, selecting Gross Wages and then going to the Exempt list to tick overtime would be the way to exclude the overtime amounts from the calculation.

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  • Steven_M's avatar
    Steven_M
    Former Staff
    4 years ago

    Hi CSSAUS 

     

    Base Salary is a wage payroll category like overtime or holiday pay. Gross Wages would be a collection of payroll categories i.e. base salary, overtime, and holiday pay could be counted as gross wages.

     

    In terms of superannuation category calculations, when you have it set to be Base Salary you would only have the amount calculated on that particular category. So any amounts paid through other payroll categories like overtime or holiday pay would not be included in the calculations. However, if it is set to be Gross wages it could be set to include Base Salary, overtime and/or holiday pay.

     

    If you do have a calculation basis set to be Gross Wages, the Exempt button will be selectable on the Superannuation Information window. Anything that is ticked in here would be exempt from being calculated. For example, say you want to include all wage categories but not include overtime, selecting Gross Wages and then going to the Exempt list to tick overtime would be the way to exclude the overtime amounts from the calculation.

  • CSSAUS's avatar
    CSSAUS
    Experienced Cover User
    4 years ago

    Thanks for the explanation.

     

    Whereabouts do I define the payroll categories that form part of "Gross Wages"?

     

    Normally I'm calculating SGC on the employee's base salary but there are occasions where a bonus is paid and obviously this needs to be factored into the SGC calculation.

     

    Cheers,

     

    Steve

  • Steven_M's avatar
    Steven_M
    Former Staff
    4 years ago

    Hi CSSAUS 

     

    Gross wages are defined by the categories that are NOT exempt in the Exempt list of the Superannuation categories i.e. Payroll>>Payroll Categories>>Superannuation>>Select the Superannuation category>>Exempt button -- anything that is not ticked in this window would be included in Gross wages.


    So, for your case where you want Base Salary and Bonus amounts to be included you want to go to that Exempt list and ensure that they are NOT ticked in this window.

  • CSSAUS's avatar
    CSSAUS
    Experienced Cover User
    4 years ago

    Firstly, if I go to my existing Superannuation Guarantee category, the exempt button is grayed out.

     

    Your comment in your second paragraph seems to contradict what you've said in the first paragraph.

     

    Steve

  • CSSAUS's avatar
    CSSAUS
    Experienced Cover User
    4 years ago

    Further to my previous post, I was able to resolve the issue of the EXEMPT button being greyed out.

     

    I added a new SGC category calling it "new superannuation guarantee" and was able to check that under the list of categories nothing was ticked.

     

    I then went back to the original "superannuation guarantee" category I had been using and noticed now that the EXEMPT button was not greyed out. Clicking on the EXEMPT button I noticed in the list of ticked exemptions was "bonus' payments. I un-ticked this and all the other categories that were ticked.

     

    I then did a test pay run and now SGC is correctly being calculated on Gross Wages when a Bonus amount is included.

     

    I suspect this issue might have occured during the migration to AccountRight 2020.

     

    Cheers,

     

    Steve

  • Steven_M's avatar
    Steven_M
    Former Staff
    4 years ago

    Hi CSSAUS 

     

    Apologies, I have made a slight mistake in my wording in my reply post but have since corrected that one. Should be:

    So, for your case where you want Base Salary and Bonus amounts to be included you want to go to that Exempt list and ensure that they are NOT ticked in this window.

    In terms of the exempt button being greyed out, what is the calculation basis set to be? If would only appear as active when the Calculation basis is set to be Equals x% of Gross Wages, rather than a particular category like Base Salary.  

  • CSSAUS's avatar
    CSSAUS
    Experienced Cover User
    4 years ago
    Steven_M wrote:

    Hi CSSAUS 

     

    In terms of the exempt button being greyed out, what is the calculation basis set to be? If would only appear as active when the Calculation basis is set to be Equals x% of Gross Wages, rather than a particular category like Base Salary.  

    OK that would have been it, I had changed it from Gross Wages to But have now reverted back to Gross Wages and all is good.

     

    Thanks for your help.

     

    Cheers,

     

    Steve

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