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This morning I completed STP certification and got everything set up with the ATO.
I now have 2 pays to process that I did in V19, so the new online company file will match and be ready to go for 1/7/18.
However, while trying to procees the first week's pay I got this message pop up:
One or more deduction, superannuation or expense amounts have exceeded their limits
This looks like somehting that was giving people grief back in 2015. So I checked my payroll categories and noticed the following:
Salary Sacrifice (deduction) when an employee pays 5% of gross wages into their Super.
Limit = 5% of gross wages.
Laptop deduction set at$50 per pay period.
Limit = $2743.95/year.
This is a very old payroll category, the employee doesn't work here any more.
So do I need to say no limit to both of these even if they are not being used?
Is chaging the salary sacrifice for Super limit going to change how I do payroll?
At the moment everything is automaticlly calculated for me; as in the 5% coming out of gross wages plus the additional employer 5% and the Employer SGC.
Generally speaking that error refers to one or more of these mentioned payroll categories being used on the current pays as opposed to an unused payroll category.
To get around this you would need to locate the superannuation, deduction or expense account that has exceeded the pre-set limit in these pays. Once you have identified which category is producing the error, then you would need to either increase or remove the limit on that category. Once the limit has been extended or removed then it should allow the pay to be processed successfully
So if we ignore the old category - laptop deduction, the only other payroll category with a limit is the Salary Sacrifice for super - 5% of gross wages which has the limit set at 5% of gross wages. In theory if we then change that limit to none everything should work fine?
It just makes me nervous as I have just swapped from v19.xx and it was never an issue when running payroll on that system. I don't suddenly want employees being deducted more than 5% of gross wages per pay run.
In simple terms AccountRight 2018.2 is warning you that the amount of the limit is being exceeded, kind of like how a credit card declines if you hit the limit on the card. Changing the limit to none would be one way around it as no limit on the category would mean no limit to produce the error
The alternative would be incrementally increase the limit just enough so that the correct payment can go through, but nothing excessive. For instance if the limit was set as $50, and the payment was $55, you could increase the limit to $60 to allow the payment to go through whilst still retaining a degree of control in that no more than $60 would be able to go through.
Its worth noting that some superannuation wage categories, like the superannuation guarantee, calculate on a monthly basis so there may be some variation in the amount on the pay which may exceed the limit however be explainable.
Additionally if you had concerns that an amount was correct on a pay, if you knew the calculation basis you could manually perform the same calculation to confirm that the figure was correct
So when you are processing a payroll, is it looking at each individual employee and then trying to work out the limit based on gross wages over the month, and then determine if the 5% limit has been exceeded?
Or would it look at total gross wages for all employees over a one month period and then base the 5% limit from that figure?
The limit on a wage category is a per pay limit. So if you have set it to be a percentage of a wage category then the limit will trigger based on that pay and that pay alone.
So if you had set a limit of 5% of the gross wages for salary sacrifice, then whatever 5% of the gross wages on that pay works out to be is the limit figure. For example, if the gross pay was $100, a 5% limit on the gross would come out to $5. Because of this if the amount of salary sacrifice on this pay exceeded this $5 limit you would get the error about exceeding the limit.