Hi ELC-Leo,
Thank you so much for your post. I would recommend speaking on your Accountant on how they will setup the employee card file. They system will automatically calculates the tax depending on what they entered on the employee TFN declaration.
Kind regards,
Earl
Hi Earl,
Thank you so much for your response.
For 15 years, I have been the one to set up the employee card, not our accountant.
The problem and confusion has come from the new self-onboarding system. If they had completed paper forms as was the process in the past, we would have manually chosen the correct Tax Table as "No Tax Free Threshold".
Having read the MYOB documentation, I understood that AccountRight would automatically fill the correct Tax Table for the employee based on what the employee enters in the tax section of the self-onboarding.
However, I believe that MYOB has not selected the correct Tax Table for these employees.
They are exempt from providing a Tax File Number, but according to the ATO, they do not come under the "No Tax File Number Resident" tax category. They should only have $18 withheld per fortnightly $100 gross earnings, not $47 per $100 as MYOB has calculated. So based on their responses, MYOB should have automatically selected "No Tax Free Threshold".
So, does MYOB select the correct tax table based on the employee self-onboarding response? Or doe sit not?
Should all AccountRight users ignore the category that MYOB selects automatically because it could be in error, and continue to choose the category manually as we did before self-onboarding?
Regards.
Hi ELC-Leo
Thanks for confirming. The on boarding process is there to simply data entry. The information applies based on how they answer the question, but if they answer it incorrectly, you will need to correct/update the employee card file.
Employees under 18 might not fit the default tax code criteria as there are special rules for them about earnings, and the onboarding process does not capture these special criteria. I highly recommend calling the ATO (Australian Tax Office) regarding Tax Declaration of the employee.
Feel free to post again, we are happy to help.
Regards,
Earl
Hi Earl,
A couple of points, for the sake of other MYOB AccountRight users who have been misled by the MYOB marketing and documentation, like I have been.
1. The employee has not answered questions incorrectly – MYOB AccountRight allocated the wrong Tax Table based on their correct answers. So I’d rather stick to discussing that scenario, please.
(Anyway, how would we know the information the employee enters is incorrect? How do you suggest that we check that the information is correct – ask them to submit a separate TFN declaration on top of the self-onboarding one? In the end, the employee is responsible for ensuring the tax status information they submit to an employer is correct. Employers act on whatever information the employee provides – and that’s what I thought MYOB was going to do for us, based on the documentation.)
2. How does it make sense to implement an onboarding process that does not capture all the information needed to select the correct tax table – and not tell users about it – but then automatically select a tax table based on incomplete information? The fact that the tax table was automatically changed from the default suggests to users that it was changed for a valid reason.
3. If it is true that your self-onboarding is not appropriate for employees under 18, then MYOB needs to state this limitation clearly in the documentation to avoid your paying users becoming liable for unknowingly withholding mistaken tax amounts. After all, our employees did select “Under 18 and below tax threshold”, to which MYOB allocates the tax table “No Tax File Number Resident”. If they are below the tax threshold, then why select a tax table that will withhold 47%? And why not warn us this might not be correct?
4. The MYOB AccountRight documentation very much suggests that it will choose the correct tax table based on the employee’s self-onboarding (screenshots included). As far as I have found, it does not say anything about employers having to confirm that the correct tax table was automatically selected. If MYOB knows that AccountRight won’t always select the appropriate tax table, then why even bother collecting the tax status information? I would much prefer a RELIABLE manual system than an automated system that gives incorrect results without even a warning.
Now that we have discovered this limitation, other than having to rectify withholding amounts, we also must decide how best to adjust our onboarding procedures (again) to ENSURE we manually select the correct tax table in AccountRight, IGNORING whatever AccountRight happens to have preselected based on an employee’s answers. We should have been told about this from the beginning!
