Creating payroll categories


Payroll category	Description
Wages	All monies paid to an employee for labour or services rendered on an hourly, salary or other basis.
Superannuation	Superannuation benefits such as superannuation guarantee and salary sacrifice.
Entitlements	Items such as holiday and sick leave, which employees accrue under the terms of their work agreement.
Deductions	Amounts withheld by the employer and paid to other organisations on behalf of the employee, for example, union fees.
Employer expenses	Employer-paid benefits other than superannuation, for example, WorkCover.
Taxes	Amounts withheld by the employer from the employee’s paycheque and paid to a statutory authority, for example, PAYG Withholding paid to the ATO.

1	Go to the Payroll command centre and click Payroll Categories. The Payroll Category List window appears.

2	Click the tab corresponding to the type of payroll category you want to create.

) next to PAYG Withholding. Tax table information is set by the ATO. Therefore, any queries should be referred to the ATO.

3	Click New. The Information window for the selected payroll category type appears.

4	Type a name for the payroll category.

5	Make the required selections for the payroll category. See the following topics for information about the options available for each payroll category type:

▪	Wages Information window.

▪	Superannuation Information window.

▪	Entitlements Information window.

▪	Deduction Information window.

▪	Employer Expense Information window.

6	Click Employee. The Linked Employees window appears.

If this employee is a contractor that you are paying for building and construction services, select Other from the Employment Basis list. Then, in the fields that appear, select the Report on Taxable Payments option and enter their ABN or TFN.

7	Select the employees whose pay will include this payroll category, then click OK.

8	If you are creating:

▪	a Wage category, click Exempt and select the taxes and deductions that do not apply to the new category

▪	a Superannuation category (and you have selected a percentage of gross wages as the calculation basis), click Exempt and exclude those wage categories that should not be included in the superannuation calculation

▪	an Entitlement category (and you have selected a percentage of gross wages as the calculation basis), click Exempt and exclude those wage categories that should not be included in the entitlement calculation

▪	a Deduction category, click Exempt and select the taxes that should be applied only to net pay (that is, to gross pay less the deduction amount)

▪	an Employer Expense category (and you have selected a percentage of gross wages as the calculation basis), click Exempt and choose the wage categories that will not contribute to the value of the expense.

10	Click OK to return to the Payroll Category List window.