Employee tax codes

Hi, All our employees are claiming the tax free threshold so I have them coded to 2-TFT. However it has been brought to my attention that they have all been overtaxed . I checked on the ATO employee tax calculator and it seems that this is correct. They have all been overtaxed. Can someone please advise what tax code I should be using. Thank you. Wendy

Accepted answers

Acctd4

Hi Wendy

Check your Super Payroll Items aren’t ticked for PAYG

Acctd4

Glad you got it sorted Wendy ☺️

All comments

Acctd4

Hi Wendy

Check your Super Payroll Items aren’t ticked for PAYG

earthmoving1

Hi Shaz, Sorry if I seem ignorant but I am not sure where to find 'Super Payroll Items' referring to the PAYG.

THank you

earthmoving1

Hi again Shaz, I worked out what you meant and that what was wrong. Thank you so much. You are a legend. Kind regards Wendy

Acctd4

Glad you got it sorted Wendy ☺️

Tania Gibson

Hi I would also like the answer to this as I have 2 TFT ticked for an employee and what is shown on the ATO tax tables as tax applicable to the gross amount, appears to be the amount applicable to no tax free threshhold One of our employees has complained that she's paying too much tax. I also don't understand the response re 'Super Payroll Items' and the relationship with PAYG. thanks

Kris_Williams

go to your payroll items - Employees - Manage payroll items - view/edit - look up the super item and see if PAYG is ticked. This could be why too much tax is coming out

Tania Gibson

Hi Kris - no this wasn't ticked thanks. She does have a HECS debt, so this could be it.

Kris_Williams

most definitely, you have that detail entered in her tax tab - correct?

Does the other employee also have a HECS debt?

Acctd4

@Tania Gibson If an employee has a HELP (previously known as "HECS") debt, they will be required to make repayments via the tax system once their income exceeds the annual threshold.

If this checkbox is ticked in their record - which it should be if they have it, other wise they will have tax payable at EOFY! - the system automatically annualises their pay each pay period to determine, pro rata, when the threshold is reached & will calculate the additional tax accordingly 😊

There are separate tax tables for those with a HELP debt: https://www.ato.gov.au/tax-rates-and-codes/tax-tables-overview#ato-Taxtablesthatwereupdatedandapplyfrom1July2025

Reckon Accounts Hosted Announcements & Important Info

Don't miss announcements and important info for Reckon Accounts Hosted

Button

Reckon Accounts Hosted Ideas & Feature Requests 💡

Do you have an idea for a feature in Reckon Accounts Hosted? Let us know here!

Button