Description
To support the ATO requirement to report tax treatment for PAYG Payees that are subject to Seniors/Pensioners Tax Offset (SAPTO), new settings have been created in the Pay Module Payee record. These will apply where the payee is:
Payees who are 66 years or older at the end of a financial year
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may be eligible for a seniors and pensioners tax offset (SAPTO) for that financial year.
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The offset that applies depends on the payee’s status which can be one of the followingThat is, such payees may be eligible to a reduced rate of tax withholding, where the extent of the reduction is dependent on whether the payee is:
single
part of a couple
part of an illness separated couple.
The new fields include:
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Field
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Description
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Details
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Seniors & Pensioners Tax Offset
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If a payee is eligible for SAPTO and their tax withholding is being reduced accordingly, it is a requirement under STP Phase 2 to report a tax treatment code that identifies that the payee is subject to SAPTO
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This setting is used to report the relevant tax treatment code in the STP report.
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and which of the three abovementioned categories apply to the payee.
To cater for this, a new option labelled Seniors & Pensioners Tax Offset has been added to the PAYG Tax Details section of the Payroll > Payee > Payee Entry screen, as shown in the example below.
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When the Seniors & Pensioners Tax Offset option is ticked, a secondary field labelled Status is enabled and it becomes mandatory to select an option from the field to indicate if the payee is single, part of a couple or part of an illness separated couple.
The Seniors & Pensioners Tax Offset option is only available if the payee’s tax scale is one of the following:
Tax Scale 2
Tax Scale 5
Tax Scale 6.
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This setting does not affect the tax calculation process, so it is editable even if the corresponding payee validity period has been used in a pay batch.
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Status
Indicates the payee’s marital status.
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Flagging a payee as being subject to SAPTO allows FastTrack360 to automatically report the relevant tax treatment code |
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to the |
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This field is mandatory where you have ticked ‘Seniors & Pensioners Tax Offset’.
You will need to define one of the Payee as one of following options:
Single
Couple
Illness Separated Couple
As above, this setting does not impact the tax calculation process, so it can be edited at any time.
In the example Payee record below the ‘Seniors & Pensioners Tax Offset’ setting has been ticked and the Status has been defined as Couple.
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ATO via STP reporting to indicate that the payee is subject to SAPTO. However, it is important to note that FastTrack360 will not calculate and apply the relevant tax offset to the payee’s tax withholding automatically when tax is calculated at the Tax pay batch stage. Therefore, the Seniors & Pensioners Tax Offset option should only be enabled if tax is being manually adjusted at the Tax pay batch stage to apply the relevant tax offset. |
We have also provided additional search criterion options to allow you to find Payees payees that have the ‘Seniors Seniors & Pensioners Tax Offset' setting option applied , via the Payroll > Payee > Search Payee > Payroll Details Tab, Tax Details section.
The ‘SAPTO’ filter is editable within the Tax Details section of Search Payee if Payee’s Tax Type criterion has been set to Any or PAYG. You can apply filters of:
Any (default)
Yes
No
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Benefits
This enhancement adds the ability to identify Payees that are eligible for the Seniors & Pensioners Tax Offset which will screen. When the option in the Tax Scale field is set to Tax Scale 2 or Tax Scale 5 or Tax Scale 6, an SAPTO search filter option is enabled as shown in the example below.
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Benefits
If a payee is subject to SAPTO and their tax withholding is being manually adjusted to account for the offset, this enhancement allows the relevant tax treatment to be reported to the ATO via STP ReportingPhase 2 to inform why the tax withholding is lower than what it otherwise would be.
Click here for more information about reporting tax treatment codes in STP Phase 2.
Configuration
On upgrade to V12.17, the ‘Seniors Seniors & Pensioners Tax Offset' setting option is available in Payee Record for PAYG Payees, in and can be enabled in the PAYG Tax No section. By default this item is not ticked, and these settings can be updated at any time in the existing payee. Where ticked the Status value must be applied to one of the following options:
Single
Couple
Illness Separated Couple
The SAPTO values can be edited even where the Payee’s corresponding validity period has been included in a pay batch.
Where set this information will be included in the STP payload to the ATO for reporting purposesDetails section of the Payroll > Payee > Payee Entry screen if the payee’s tax scale is set to Tax Scale 2, 5 or 6.
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To be subject to SAPTO, a payee must be an Australian resident, must provide a TFN and must be claiming the tax-free threshold. Therefore, Seniors & Pensioners Tax Offset option is available only if the tax scale that is selected is Tax Scale 2, 5 or 6. |
On enabling the Seniors & Pensioners Tax Offset option, the secondary field Status is enabled, and it is mandatory to select the SAPTO status that applies to the payee (i.e. single, part of a couple, part of an illness separate couple), which identifies the extent of the tax offset that is being applied to the payee.
Because the Seniors & Pensioners Tax Offset option does not automatically affect tax calculation in FastTrack360, it is possible to toggle the Seniors & Pensioners Tax Offset option on or off without adding a new validity period to the Payee record.