Old entity to new entity STP reporting issue

StephenLi

Hi there,

At end of March this year the company I work with had gone restructuring and a new entity has been created to take over the existing business operations. All staff members were transferred accordingly to the new entity but two pay runs happened in April were done in the old entity’s Reckon Payroll.

The new entity’s Reckon Payroll was not set up until early May this week and the first May pay run was done with the opening YTD payroll figures consist of the ones from the last pay runs in March.

I have got the following questions and really appreciate if someone in the community can help to answer them :

1. Is it all right to delete the April pay runs done under the old entity’s Reckon Payroll and then submit an EOFY STP containing only the figures up to end of March 2024 to ATO ?

2. Is there a way to check whether the figures in EOFY STP to be submitted are correct?

3. As the new entity’s Reckon Payroll Summary report does not include the opening YTD figures carried forward from the last March pay run, does it mean the first May pay run’s STP declaration to be submitted to ATO would not include those YTD figures as well? If it does not include, does it mean the March pay runs done in the old entity have to be recreated in the new entity’s Reckon Payroll?

Thanks in advance for those who can help answering the above questions.

Rav

Hi @StephenLi

Just before we get into your questions, can I just confirm whether the ABN has changed for the company as part of the restructure?

If so, has that been updated in Reckon Payroll and a new STP entity created for it as well?

StephenLi

Hi Rav, thanks for reaching out. Yes the ABN has changed and a new STP entity has been created for the first May pay run.

StephenLi

Apologies for mis-typing in the post above regarding the month of the YTD balance to be carried forward from, it should be April, not March, i.e. the opening YTD figures entered in the new entity's Reckon Payroll were from the last April pay run given the staff members were under the new entity's operation since the beginning of April. Sorry for the confusion.

Rav

Ok cool, thanks for confirming 🙂
It sounds like you have a good understanding and you're pretty much on the right track so I'll just add some info for your questions below.

Is it all right to delete the April pay runs done under the old entity’s Reckon Payroll and then submit an EOFY STP containing only the figures up to end of March 2024 to ATO ?

I think the above is likely the best option. Deleting those pay runs will remove any of the balances attributed to the employees and will be reflected in the totals for the EOFY finalisation. Its crucial that an EOFY finalisation is sent under the old ABN so that the final balances for all employees under this entity are finalised and set to Tax Ready.

Is there a way to check whether the figures in EOFY STP to be submitted are correct?

Yes, when you generate your EOFY finalisation it will show the balance of all payruns that are marked as paid + any initial YTD balances that have been entered for each employee. See example screenshot below.

As the new entity’s Reckon Payroll Summary report does not include the opening YTD figures carried forward from the last March pay run, does it mean the first May pay run’s STP declaration to be submitted to ATO would not include those YTD figures as well? If it does not include, does it mean the March pay runs done in the old entity have to be recreated in the new entity’s Reckon Payroll?

You're correct, the Payroll Summary Report doesn't include balances that are added in the initial YTD section for the employee(s). However when it comes to STP submissions, they are sent and reported on a full YTD basis so when you send the first submission under the new entity it will send the full YTD balance including those that have been added under initial YTD.

I'd recommend adding the balances that were paid in April under the new entity to each employee's initial YTD so that you don't have to recreate those pay runs.

Hopefully that makes sense and I haven't confused matters more but let me know if you have any questions.

StephenLi

Thank you so much Rav, it really helps me in solving the issue. Thanks again.