Forum Discussion

LKJAMES17's avatar
LKJAMES17
Contributing User
2 years ago

Salary Sacrifice Superannuation 'Not Reportable'

Hello MYOB, I have an ongoing issue. We have salary sacrifice super for employees which from what the ATO website says and also as advised by our accountant are 'not reportable' because the employees have no choice over this salary sacrifice. The ATO guidelines is that superannuation contributions which are part of a collective agreement (which this is) and that cannot be influenced by the employee are 'not reportable'. The EBA wording states that 'the employee will co-contribute by way of salary sacrifice $64 per week into their superannuation'. I have had confirmation from the ATO that this is correct, that these amounts are not reportable. When I tick the not reportable STP option for salary sacrifice super the amounts in MYOB, they are not being sent to the ATO at all in STP Phase 2.  So the ATO will not know to deduct these amounts from the employee's taxable income. I have tried to speak with MYOB twice over the phone about this, however they have been unhelpful and basically told me that I will need to allocate this payroll category to 'salary sacrifice AND RESC' as all amounts need to be sent to ATO pre salary sacrifice amounts. I understand that the ATO needs all pre sacrificed amounts but then the ATO also need to know to then deduct these not reportable salary sacrifice super amounts but there is no way for them to know with the way MYOB is currently setup and sending the information through.

Our accountant has advised that we should get something in writing from MYOB stating that we must allocate these amounts to 'salary sacrifice and resc' because the 'not reportable' option does not work and then that way we can apply to get a letter from the ATO in writing to confirm that we need to use this reporting option for STP Phase 2 and if our employees have any issues with income tests we can show them this. 

 

  • Doreen_P's avatar
    Doreen_P
    MYOB Moderator
    2 years ago

    Hi, LKJAMES17 

     

    Thanks for your post.

     

    According to the ATO, salary sacrifice that will go to super and set up as a deduction are reportable employer superannuation contributions. However, since we are not permitted to provide which ATO Reporting Category to choose, we highly recommend getting in touch with ATO or your accountant. Also, you may check The Help Article Assign ATO reporting categories for Single Touch Payroll reporting for further information. 

     

    Please let me know how it goes.

     

    Best regards,

    Doreen

    • LKJAMES17's avatar
      LKJAMES17
      Contributing User
      2 years ago

      Hi Doreen thanks for your reply.

       

      I have spoken with my accountant and the ATO and there should be an option with STP Reporting to split out Salary Sacrifice Super S and Salary Sacrifice Super RESC) as there IS a difference. Not all Salary Sacrifice supers are reportable RESC.

      The wording I received from ATO is:

      'You report Gross, you report Salary Sacrifice to Super. That is mandatory, not negotiable. Fact.

       

      Now let's talk abour RESC. Typically, sal sac is voluntary but some agreements, as you say yours is, don't give employees that choice, it is mandatory. In that case, the sal sac super is NOT RESC. That is, normally you would report, for example:

      • Gross 60,000
      • Sal Sac Super 10,000
      • RESC 10,000
      • Super Liability (70,000 x SG rate)

      You won't need the RESC.'

       

      Doreen, Is there any way to put in a request for myob to look into this please and have a change in the ATO reporting categories in MYOB??

       

      Thank-you.

      Leah

       

       

      • gavin12345's avatar
        gavin12345
        Ultimate User
        2 years ago

        Hi LKJAMES17 

         

        The ATO specifications clearly show there are 2 types of Salary Sacrifice into super fields, one which is RESC and one which is not. Developers normally accommodate both, however from experience it seems MYOB developers decide their users won't need some features, so they do not provide. 

         

        STP Creator (used by MYOB users) for example has both.

         

        I wouldn't expect MYOB to accommodate for this any time soon. One thing to try, take a look under the EOY finalisation tab in the Payroll Reporting Centre. See if there is an option for RESC there (as there is for RFBT). Some employers pay RESC at year end for directors etc which is not Salary Sacrifice. They might be able to add it here at year end like they were able to with Payment Summaries years ago.

         

        If there is, you could try to enter -10000, which in your example might offset the +10000 RESC and report $0 RESC. Just a thought.

         

        Regards

        Gavin

    • Celia_B's avatar
      Celia_B
      MYOB Staff
      2 years ago

      Hi LKJAMES17 

       

      Thank you for your post and welcome to the Community Forum.

       

      As for this matter,  We are not permitted to provide which ATO Reporting Category to choose and we don't have permission to change reporting categories from the ATO. Our recommendation for this is to contact the your Accountant if you are unsure. 

       

      Your ideas are important to us. Rest assured that we will raise this to our relevant team and this looked as a priority. I also encourage you to please take a moment to post on the AccountRight Ideas Exchange board for consideration.  Kindly check on this link.  https://community.myob.com/t5/AccountRight-Idea-Exchange/idb-p/AccountRightIdeas.

       

      If you need further assistance in the future, don't hesitate to contact us again. We're happy to assist you. 

       

      Thanks, 

      Cel

      • Freman's avatar
        Freman
        Trusted Partner
        2 years ago

        I've re-read the wall of text several times (It is very difficult to follow when you don't paragraph). I think I have the jist of what the issue is.

         

        "So the ATO will not know to deduct these amounts from the employee's taxable income." I've never heard of the ATO doing any of the maths on behalf of the employers. Software does it and then reports the answers to the ATO.

         

        What you need is a work-a-round due to that fact (for your case) you cannot control PAYGW calcs on Superannuation Pay Catagories (thanks very much MYOB.Not).

         

        Fun fact: the Superannuation Tab in the category list did not always exist in MYOB, Super items were spread out in the Deductions & Expense tabs originally.

         

        Option 1:

        Think about adding your non-reportable  Salary Sacrifice to the deductions tab and set it to exclude that category from the PAYGW calc.

         

        Downside of this work-a-round will be when it comes to actually paying the super I don't believe there is any way  to make it appear in the 'Pay Superannuation' screen if you use that function.  If you use the 'Pay Liabilities' then it will appear under deductions.

         

        Also bear in mind that when the 'pay super at the same time as the actual pay run' comes in (1/7/2026) this work-a-round might fail there too.

         

        Option 2 (More complex but easier to explain)

        See if it is viable to split the non-reportable Super amount out of the base hourlyin the Wages Category (using multiplier to get the correct calc). Exempt the non--reportable Salary Sacrifice wages from the PAYGW calc

         

        Then set up a Super deduction  (non-reportable) and set it to equal 100% of the of the wage category you split out.

         

        If you have lots of complex calcs going on in your payroll this method will need extensive testing to ensure you don't inadvertantly cause issues else where in payroll. But its up side is it retains the super liability category in the correct place.