FastTrack360 Version 12 Online Help
Preventing Negative YTD Earnings (AU Only)
- Max Ciereszko
Description
The pay batch process has been enhanced so that a pay batch cannot be closed if pay transactions in the pay batch will cause any payees' earnings to be negative for the current year-to-date (YTD). An error message is now displayed at the Review pay batch stage when you attempt to close the pay batch if closing the pay batch would result in negative YTD gross earnings for one or more payees in the batch. The error message identifies the affected payees, as shown in Figure 1 below.
Figure 1: Close Pay Batch Negative YTD Earnings Error
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If this error message is displayed, the following can be done before attempting to close the pay batch again:
remove the affected payee(s) from the batch
adjust or remove any transactions for negative amounts that may be reducing the affected payee(s) gross earnings to less than zero.
It is still possible for a payee to have negative gross earnings in a pay batch, so long as the payee’s overall gross earnings for the financial year, in which the payment date of the pay batch falls, do not fall below zero because of the pay transactions that would be committed if the current pay batch was closed.
If an overpayment, which occurred in a prior financial year, needs to be recovered in the current financial year, it is important that the payee’s YTD earnings for the current financial year are taken into account when reducing the payee’s earnings to claw back the overpayment. For example, you may need to recover the overpayment over multiple pay periods to ensure that the payee’s YTD earnings would not potentially go into negative.
If a payee has repaid the overpayment directly, such as by refunding the overpayment in cash, then a balancing payments adjustment batch should be processed to adjust the payee’s YTD earnings. If the overpayment related to a prior financial year, the balancing payments adjustment pay batch must be for a period in the relevant, prior financial year.
Benefits
This enhancement facilitates compliance with statutory reporting requirements whereby the ATO will reject Single Touch Payroll (STP) submissions if a payee’s gross earnings for a financial year are reported as negative. By preventing a pay batch being closed if the transactions in the pay batch would result in negative YTD earnings, STP submission rejections due to negative aggregate YTD gross earnings are prevented.
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