super for subcontractors

[Buddi]

Thanks All,

Can you please suggest the best way to record/pay superannuation for a subcontractors apart from creating as an employee card for them?

Much appreciated your help.

Thanks

Buddi.

[Princess_R]

Hi @Buddi,

Thank you for your post.

I'm sorry for the late response. I understand that you're looking for the best way to handle subcontractors, and I'm here to help.

Subcontractors can indeed be complex and potentially costly if not handled correctly. It's crucial to accurately classify your worker as either a contractor or an employee, as per the guidelines of the ATO. To assist you in this process, the ATO website provides a useful tool: Employee or Contractor Decision Tool. It's highly recommended to consult with the ATO or your trusted accountant for further clarification. 

However, a common way to handle super for subcontractors is to create an employee card and process only the super accrual amount in pay runs. This help article, Superannuation, has detailed information to assist with this. Kindly get to the bottom of the article and look for FAQ's: How do I pay super for a contractor?

Please feel free to reach out if you need further assistance.

If my response has answered your inquiry, please click "Accept as Solution" to help other users find this information.

Cheers,

Princess

[Buddi]

Hi Princess,

Thank you very much for your help here.

I've created an employee card for the contractor and processed payroll only for Super liability.

Unfortunately it comes an error code: ATO Error Code:CMN.ATO.PAYEVNTEMP.000272 when finalising the pay.

I've chosen Other( Not reportable) as the Employment Basis.( I guess this is the reason for the above error)

I checked with ATO and they advised to consult MYOB to rectify this error.

Kindly advise

Thanks.

[Princess_R · Accepted solution]

Hi @Buddi,

Thank you for your response. 

Apologies for the delayed response. This error is often related to the details submitted for Single Touch Payroll. As for the superannuation for subcontractors, it's important to ensure that the contractor is set up correctly. According to the information I've found out about this error, you're using an employment basis code that does not exist. The only ATO STP2 employment basis code that is valid for reporting super liability for contractors is N for non-employees, as per the ATO STP2 Employer Guidance. Choosing the Other (Not reportable) as an employment basis should fix the error.

Please let me know if you need further assistance.

Cheers,

Princess