Long Service Leave
I have an employee who would like to take 150 hours of his long service leave as a lump sum payment
Will my Reckon Accounts Plus 2020 calculate the correct amount of tax to deduct or do I need to do something differently?
I have never had an employee reach long service leave entitlements before
Comments
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RA calculates PAYG tax using the ATO's standard pay frequency (eg weekly, fortnightly, monthly) tax tables in conjunction with the "Federal Taxes" section of the employee's record (including the tax code selected here) & the Pay Frequency/pay period.
It is unable to automatically calculate the tax for scenarios outside of this so some people prefer to calculate the tax manually & just edit the PAYG tax payroll item amount on the pay.
Personally - as the system tends to over-calculate rather than under - I just go with the RA calculation as the employee will get any additional tax that they're owed back when they do their tax return.
Shaz Hughes Dip(Fin) ACQ NSW, MICB
*** Reckon Accredited Partner (AP) Bookkeeper - specialising EXCLUSIVELY in Reckon Accounts / Hosted ! ***
* Regd BAS Agent (No: 92314 015)* ICB-Certified Bookkeeper* Snr Seasonal Tax Consultant since 2003 *
Accounted 4 Bookkeeping Services
Ballajura, WA
(NB: Please give my post a Like or mark as Accepted Answer if I have been able to resolve your query as this helps others when seeking solutions!)
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If you donβt want to overtax him, or he has an issue with it, this is what I would do.
Get the gross figure for the leave and divide it by 52. Add this amount to an ordinary pay an see how much extra the tax works out. Multiply the extra tax by 52 and use this amount
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