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Hi, I have an employee whose actual hours worked for the week is above his normal hours but due to his ineligibility for overtime pay, those extra hours are paid at his hourly base rate. This resulted in the PAYG being computed incorrectly in AccountRight. In our old payroll system, the software automatically spreads out those extra hours over 52 weeks but in AccountRight, I'm not sure what settings to tweak so that I can get the same PAYG amount as per old payroll system (currently in parallel run for old and new systems). Please help and thanks much in advance!
There are several aspects to this post that I would question.
Firstly the non-payment of overtime could be cause to raise the interest of Fair Works. If this is a salary employee (paid using hourly) it is generally handled by time off in lieu of overtime.
Secondly using base hourly for hours in excess of his normal hours will throw out your entitlements accruals. You need to use a (new) wages category called Additional hours and have this exempted under the entitlements.
Under current ATO regulations there is no allowance for spreading PAYG for Ordinary Time Earnings and I am interested as to both how and why it does such a computation. Are other PAYG figures in general agreement?
Thank you Ron for your reply!
The point about throwing off entitlement accruals is a good one. I have since created a new wage category for the hours in excess of the employee's normal hours.
As for the PAYG anomaly, all other employees' PAYG amounts are alright. Just this morning, another scenario relating to PAYG for the same employee arose. This employee worked in excess of the usual weekly hours for a consecutive week but this time round, the PAYG amount manage to tally with the amount calculated by old payroll system.
I tried deleting and rekeying the timesheet for the previous week (with PAYG anomaly) but I still ended up getting a PAYG amount that doesn't match up to old system's despite both weeks' hours worked being in excess of normal hours. I am really puzzled. Please help and thanks much in advance!
There is probably little that I can add to this other than to suggest that you down load a copy of the tax tables https://www.ato.gov.au/Rates/Weekly-tax-table/ and find out what the ATO expects you to withold.
One possiblity is that you have selected TFN+HELP This works on a pay by pay basis and amounts in excess of the HELP limit($55874/52= $1074.50) will trigger a withholding inclusive of HELP payment.