Adding a Contractor to Essentials Payroll

[MaxVino]

Hi Community,

We want to hire a contractor for agricultural work and would have to deduct withholding tax from his invoices. According to the accountant, the withholding tax must be collected through PAYE.

Is there a way I can set up the contractor as an employee in MYOB Essentials Payroll that will allow me to enter a lump sum in the weekly payrun to collect the wihtholding tax?

Thanks

Max

[jenniek]

Hi @MaxVino 

use the WT tax code and put on the % you want.

Then set the leave calcs to NIL.

[MaxVino]

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@jenniek wrote:

Hi @MaxVino 

use the WT tax code and put on the % you want.

Then set the leave calcs to NIL.

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Hi Jennie,

Thanks for the advise, however, Essentials Payroll won't let me enter a lump sum but instead asks for hours worked and days being paid. The contractor sends an itemised invoice and not a timesheet, so I'm still unusre how to enter/deduct their WT.

Thanks,

Max

[SamaraM · Accepted solution]

Hi @MaxVino 

It's great to see that @jenniek has provided assistance with this. If it is asking you for hours, then you will need to edit the Rate Type. 

Go to; Payroll > Pay Items > Open [ . . . ] next to the pay item > Edit > If the rate is "Per hour" change to "Fixed amount" > Save.

After doing this when you create a pay run it should only ask for the full amount.

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.

[MaxVino]

Hi Samara,

Thank you, that's exactly how we solved it. For anyone interested, follow the steps below:

Set up the contractor as casual employee; pay details to $0.00; Tax Code WT; Leave to 0.00

Go to Pay items --> Earnings --> Add earning --> (name it)--> Type: Standard Earning --> Rate: Fixed Amount --> Tax: Taxable --> Tick Exclude from KiwiSaver

Now you can enter the invoiced amount with the next payrun.

Best Regards,

Max