How to Generate PAYG Payment Summaries

This workflow should be followed at the end of the tax year to generate and print PAYG Payment Summaries for all employees and to lodge Payment Summary data to the ATO electronically.

Payment Summaries can be produced individually during the year in the case where an employee is terminated.  Refer to the 'How To' guide How To Generate PAYG PAYMENT SUMMARIES for an Individual Employee.

There are 2 types of Payment Summaries that can be produced:

• Individual Non Business Payment Summary (INB)

• Employment Termination Payment Summary (ETP)

Complete the following steps in this order:

STEP 1 - Check Reportable Employer Superannuation Setups

Effective from the first pay run in the 2009/10 tax year, certain superannuation contributions must now be shown on Payment Summaries under “Reportable Employer Superannuation Contributions”. Therefore, you must ensure that the pay codes and accrual codes that you have used for 'Reportable Employer Superannuation' have been flagged to indicate this.

To do this, use program Payroll > Setup Information > Payroll Setup on the 'Paycodes' and 'Accrual Codes' tab. Check that the appropriate pay codes and accrual codes have the 'Reportable Employer Superannuation Contribution' checkbox ticked.

STEP 2 - Back-up

Use program Payroll > Pay Run Processing > Backup.

STEP 3 - Extract Pay Summary Data 

Use program Payroll > Year End Processing > Extract Pay Summary Data to collate each employee's YTD payroll balances and create their Payment Summary records.

STEP 4 - Run and check the Reconciliation Report

Use program Payroll > Year End Processing > Reconciliation Report.

This Reconciliation Report lists the details of each employee's Payment Summary data for both Individual Non Business Payment Summaries and Employment Termination Payment Summaries.

It includes totals for Gross, Allowances, Reportable Fringe Benefits, Reportable Employer Super, Lump Sum Termination Payments, Deductions and Tax.  It also prints the employee's Tax File Number and the employment period.

STEP 5 - Enter reportable fringe benefits and other amounts

Use program Payroll > Year End Processing > Payment Summaries to modify the extracted Payment Summary records.

The mostly likely use for this would be to enter Reportable Fringe Benefits.  The 'Grossed Up' value should be entered.

This program can also be used to:

• enter CDEP (Community Development Employment Projects) amounts

• enter Workplace Giving amounts

• enter Union/Professional Fees

• enter Exempt Foreign Employment Income

• edit other data that is incorrect

Tip! As the Fringe Benefits Tax Year (1 April to 31 March) does not coincide with the PAYG Tax Year (1 July to 30 June), you may have a situation where an employee does not have a Payment Summary record (eg. employee was terminated in last tax year) but you need to report a Fringe Benefit Amount for the 3 month period prior to the start of this PAYG Tax Year.

The likely scenarios and procedures to handle this would be:

• If the employee has been archived you need to re-instate them as the first step, then do an extract (Step 3) for that one employee (by entering his/her Employee Code) and tick the 'Create Zero Value Payment Summaries' box. 

• If the employee has not been archived (terminated but not archived) but he/she has not been paid in the current tax year you need to do the extract (Step 3) for that one employee (by entering his/her Employee Code) and tick the 'Create Zero Value Payment Summaries' box. 

STEP 6 - If changes have been made

If changes have been made in Step 5 above, re-run program Payroll > Year End Processing > Reconciliation Report and check.

STEP 7 - Print payment summaries

Use program Payroll > Year End Processing > Print Payment Summaries.

Payment Summaries will only be printed for employees who have field 'Pay Envelope Pref' set to 'P = Printed' on the 'Payroll Details' tab in program Payroll > Employee Information > Employees.

Payment Summaries for employees who receive them electronically using 'Teacher Kiosk', will be available once they have been issued (Step 8).  Refer to the on-line help for program Payroll > Year End Processing > Print Payment Summaries for more details.

STEP 8 - Issue Payment Summaries

Use program Payroll > Year End Processing > Issue Payment Summaries.

This program flags 'Un-issued' employee Payment Summaries as 'Issued'.

These employee Payment Summaries will be 'excluded' (ie. not extracted) if you re-run Payroll > Year End Processing > Extract Pay Summary Data again.

STEP 9 - Create ATO File

Use program Payroll > Year End Processing > Create ATO File to create the file.

Tip! This program checks the payment summary data and displays a screen that is relevant to the status of your data. Refer to the on-line help for program Payroll > Year End Processing > Create ATO File for more details

STEP 10 - Validate ATO file

To check that the EMPDUPE file created in Step 9 above is correct, go to 'Business' > 'PAYG Summary Reports' > 'Payment Summary Report' and click 'Find' to navigate to the file then click 'Check File'.

If the file is validated without error, then the file is in the correct format and all the data is valid, go to Step 11.

If there are errors detected, these will be logged into an error file and noted on this screen. You should open this error file and review and resolve each error found.  You will need to follow the following instructions:

• Use program Payroll > Year End Processing > Create ATO File.  The file that you have created with the errors will be displayed as a 'Run ID'.  You need to delete this by clicking on the 'Delete' Action link.

• Use program Payroll > Year End Processing > Payment Summaries to edit the Payment Summary information for the relevant employee(s).  This will automatically 'un-issue' the Payment Summary for those employees.

• Depending on the error you can either re-run the extract for the affected employee (by entering their Employee Code) or edit their Payment Summary to fix the incorrect data.

• Follow this guide from Step 6 onwards.

STEP 11 - Transmit the file to the ATO

STEP 12 - Flag the ATO File

Use program Payroll > Year End Processing > Create ATO File.