Forum Discussion

HDAdmin's avatar
HDAdmin
Experienced User
9 months ago

Salary Sacrifice Super to a cotractor

Hi I have a contractor who wants some of their income as salary sacrifice. I have already set up her as an employee ans has been paying SGC super.  I just processed her first Salary Sacrifice/   I ...
  • HDAdmin's avatar
    HDAdmin
    9 months ago

    Hi Gavin,

     

    I spoke to my accountant and she said as long as the Payroll Summary picks them up separately (which it does), it should be OK.

     

    I rang ATO before contacting MYOB, and they said SSS should be separate in Payroll Reporting, then I panicked.  Person I talked to may have be from superannuation related department and not necessarily expert in Payroll Reporting.

     

    MYOB setting may well be due to compliance issue.

     

    I really appreciate your detailed comment.  Thanks!

gavin12345's avatar
gavin12345
Ultimate User

Hi HDAdmin 

 

Aside from the issues you are having with assigning the payroll category 'Salary Sacrifice Super MH' to the ATO Reporting category of 'Salary Sacrifice and RESC', just letting you know that if the payee (covers employees and contractors) is set to an Income Type of Voluntary Withholding or Labor Hire, you will NOT be able to report salary sacrifice for this payee. This is because according to the ATO, a contractor cannot have employee type benefits such as Leave, Allowances, Overtime, Bonuses, ETP, or Salary Sacrifice. 

 

The ATO seems to be using STP Reporting to crack down on what is in their view an employment relationship 'dressed' up as a contractor arrangement. Given the complexities of this issue, I would strongly recommend discussing the entire issue with your accountant or tax adviser, including how to report the various income components.

 

FYI - it could be the MYOB developers coded the software this way to prevent your STP Report being rejected by the ATO as not complying with their specifications. They didn't do this in other places, but you never know.

 

Regards

Gavin

HDAdmin's avatar
HDAdmin
Experienced User
9 months ago

Hi Gavin,

 

I spoke to my accountant and she said as long as the Payroll Summary picks them up separately (which it does), it should be OK.

 

I rang ATO before contacting MYOB, and they said SSS should be separate in Payroll Reporting, then I panicked.  Person I talked to may have be from superannuation related department and not necessarily expert in Payroll Reporting.

 

MYOB setting may well be due to compliance issue.

 

I really appreciate your detailed comment.  Thanks!

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