STP and Voluntary Withholding for Contractors

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STP and Voluntary Withholding for Contractors

Hi

 

Our client is currently assigning the ATO Payroll Categories in relation to STP reporting with the ATO, and runs a contractor with a voluntary withholding agreement through the payroll system.

 

The contractor is setup as an employee in the payroll system and the employement basis is setup as "Labour Hire".

The contractor has a voluntary agreement in place so the tax table selected is "Withholding Variation", with a variation rate recorded.

 

Will the ATO know through the STP processing that the payment summary will be a non-individual payment summary due to the "Labour Hire" selection at the employment basis tab, and will the tax withholding automatically be reported here as well, based on this current setup?

 

It is also a requirement that we report the ABN to to the ATO for the contractor. Is there a place we can enter this in the contractors employee card that will send this information through to the ATO?

 

Thank you.

 

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Re: STP and Voluntary Withholding for Contractors

Hi @ksmith 

 

My understanding is that employee's pays that have marked as the Labour hire employment status will be reported to the ATO through payroll reporting. From a reporting of view, it will pass across the dollar value of the PAYG Withholding paid to the employee. 

 

In terms of ABN point of view, as AccountRight doesn't allow for the user to enter an ABN for an employee's card as such we do recommend lodging a TPAR with the ATO to report those values to the ATO.

Kind regards,
Steven

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Re: STP and Voluntary Withholding for Contractors

ARPlus should just allow for an ABN to be put against anyone selected as Labour Hire or Other.  It happens in Business Enterprise.

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