PAYG Tax withheld from pay incorrect

Felicity VanFelicity Van Member Posts: 85
edited October 2018 in Accounts Business Range
I have incorrectly worked out a staff members tax withheld.  How do I go about fixing it, so they get paid correctly & it doesn't stuff up my accounts come year end?

The gross pay is correct, just the tax - so we owe them money (withheld too much tax).

Thanks.

Comments

  • John GJohn G Reckon Staff Posts: 2,283 ✭✭
    edited October 2018

    Hi Felicity,

    Welcome to the Reckon Community

    You'll need to modify your pay transaction by reducing the tax amount to the correct amount and adding a deduction for the amount of the difference so that the total of Net Pay remains the same.  You can then clear the deduction with a cheque or deposit to the employee's bank account. 

    Regards,
    John

  • SusanRSusanR Accredited Partner Posts: 43
    edited November 2016
    Hi Felicity,

    Another tip - make sure that you have the correct tax code on the employee record so in future Accounts withholds the correct amount.  A description of each tax code can be found from the drop down menu Employees and then choosing  Tax Table Information > Tax Table Info > Key for Tables.

    I hope this also helps.

    Sue
  • Felicity VanFelicity Van Member Posts: 85
    edited October 2018
    Thanks John,

    Sorry, I'm still a little confused...

    When you say "adding a deduction..." what sort of deduction? Do I need to set up another payroll item for this? & if so, what account do I post it to, so that it doesn't affect my accounts too much?

    Sue - my issue was that this was a "one off" payment, so the tax was a little different to work out, but thanks for you help too!

    Regards,
    Felicity 
  • John GJohn G Reckon Staff Posts: 2,283 ✭✭
    edited December 2016

    Hi again Felicity,

    Yes, set up another payroll item of Deduction Type and set it to a Payroll Liabilities account.  Then use the Employees > Payroll Taxes and Liabilities > Create Custom Liability Payments option to pay out the refund. 

    Regards,
    John

  • Felicity VanFelicity Van Member Posts: 85
    edited December 2013
    Excellent - thank you so much!
    I'm so glad I found this site... :-)
  • heatherheather Member Posts: 26
    edited July 2016
    Why wouldn't Felicity be able to just change the tax amount manually in the pay cheque window?
  • Kevin V. RussellKevin V. Russell Member Posts: 336
    edited June 2015


    Hi Flick. You shouldn't have to "work out" the tax. If you use the correct withholding scale, the Reckon software will do all the work for you. You must ensure all of the detail on the Income Tax Installment Declaration is filled out. Pay particular attention to the HELP question because and also if the employee is claiming the tax free threshold elsewhere.


  • Kevin V. RussellKevin V. Russell Member Posts: 336
    edited June 2015


    You can change the amount manually every week but it is not recommended. What happens if you forget? What happens if you are not around to run the pays? No, it is far preferable to get the information right on the Employee card and let the software do the work. It's what it does best. You can always check the tax using the TWC on the ATO website but you shouldn't need to.


  • heatherheather Member Posts: 26
    edited July 2016
    Yes but I think it was a one off payment Felicity was talking about.
  • Felicity VanFelicity Van Member Posts: 85
    edited December 2013
    yes, it was a one off payment.
    not a usual pay also.  So the tax (even though everything is set up correctly) is incorrect.

    We pay employees fortnightly - this was for a casual on a "project based" contract - with a full lump sum at the end of the contract.  

    I have to work out correct tax as well for termination payments as the software doesn't pick it up correctly.  It's not a big deal.

    What John told me to do, worked & I'm grateful for the help :)
  • Felicity VanFelicity Van Member Posts: 85
    edited December 2013
    Thanks Kevin - hate "flick!" lol

    it was  a one off scenario - & not as simple as ticking the right boxes...
  • Kevin V. RussellKevin V. Russell Member Posts: 336
    edited June 2015

    My profuse apologies Felicity. That won't happen again. Have a great day.
  • Kempsey Race ClubKempsey Race Club Member Posts: 2
    edited March 2014
    This reply was created from a merged topic originally titled PAYG Adjustment. An employee was overtaxed for a number of weeks.I have since paid back to the employee the amount he was overtaxed. How do I enter this into his payroll records. Payroll won't let me enter a positive PAYG amount
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