Payroll - Superannuation & Tax for KM Travel Claims

Hi Nooora 

Thanks for your post. If you haven't already done so I'd check with the ATO on whether super is payable on the KM travel allowance or not. This link to the ATO website says that Cents per KM car expense allowance and Travel allowances aren't OTEs so not included in super calculations. If that is your situation you'd need to exclude the allowance from super calculations by:

1. go to Payroll Categories>>Superannuation tab
2. open the Superannuation Guarantee category
3. click Exempt, tick the allowance that shouldn't be included in the calculation and click ok
4. click Ok to save the changes

Super is 10% of Ordinary Time Earnings (OTEs) and if your travel allowance is seen to be an OTE I would expect that it is included in the $450 threshold, something else I'd check with the ATO.

If super is calculating when the $450 threshold hasn't been meet, make sure the threshold is entered in the Superannuation Guarantee payroll category.

If the travel allowance is included in gross wages in the AccountRight reports that's correct. In the STP reports it should be reported under allowances. It it's not make sure the correct ATO reporting category has been assigned to the payroll category.

This help article, Allowances, has full instructions on setting up the KM travel allowance. If 100% of the allowance needs to be taxed make sure you don't exempt it from PAYG calculations. Do this is the allowance payroll category>>click on Exempt and make sure PAYG Withholding isn't ticked. It sounds like you have two payroll categories, one that is exempt from PAYG calculations and one that isn't. If you are taxing the whole amount, only use the taxed payroll category when processing pays.

Please let me know if you need further help with this.

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