PAYG tax details apply to payees who have tax withheld from their earnings by their employer under the Pay-As-You-Go tax scheme.
When a payee who is subject to PAYG withholding commences employment with a pay company, the payee must hand in a Tax File Number (TFN) Declaration form that is then used by payroll staff to populate the details on the Portal > Pay > Payee > Payee Maintenance > Payee Entry > PAYG Tax Details screen.
At the time of commencing employment the payee may indicate on their TFN Declaration form that they have applied to the ATO for a TFN. In such cases it is necessary to update the payee's TFN once the payee provides it.
Once the payee has been paid (included in a closed pay batch) their PAYG tax details are locked down for the corresponding payee details validity period and cannot be modified for that period.
However, if the payee provides a TFN after they have already been processed in one or more pay batches, the TFN and TFN signature date can be updated despite all other tax details being locked down. To modify any other tax details, you must create a new payee details validity period.
If the payee fails to provide a TFN within 28 days of their employment start date, the following will occur automatically unless the Exempt From TFN 28 Day Rule field has been ticked on the Portal > Pay > Payee > Payee Maintenance > Payee Entry > PAYG Tax Details screen:
the No TFN Provided (28 day rule applied) field on the PAYG Tax Details becomes ticked to indicate that the payee has failed to provide a TFN within 28 days
the payee's tax scale is set to 4a (if the payee is an Australian resident) or 4b (for non-residents)
the payee is taxed at the highest rate from that point on until the payee's tax scale is changed manually and a TFN number is specified.
Once a TFN is keyed in, the Declined TFN Number Declaration option is selected or the No TFN Provided (28 day rule applied) field becomes ticked on the PAYG Tax Details, the payee’s TFN declaration information will automatically be reported through Single Touch Payroll (STP) reporting.
How to View & Update the PAYG Tax Details
To view and update a payee's PAYG tax details, follow the procedure below.
How to View & Update the PAYG Tax Details | |
If you do not already have the relevant payee record open in the Payee Entry screen, search for and open the relevant payee record in edit mode. | |
2. | Navigate to the Payee Details > PAYG Tax Details section of the Payee Entry screen. |
3. | If the payee has provided a TFN, key in the TFN in the TFN Number field and proceed to step 4. |
4. | Click on the TFN Declaration Signed field so that it displays a tick to indicate that the payee has signed a TFN Declaration form. |
5. | In the TFN Declaration Signed Date, select the date on which the payee signed the TFN Declaration form. |
6. | At the top of the Payee Entry screen, Save . The changes you have made are saved. |
If the payee has not already been in any closed pay batches and the payee is not currently included in an open pay batch, any of the PAYG tax details can be updated if necessary.
For more information about the fields and components on the Payee Entry screen, see Working with the Payee Entry Screen.