An employee was salary sacrificing super & then wanted to cease

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  • Updated 5 months ago
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I have an employee who was salary sacrificing part of their salary to super each fortnight.

They requested that to be ceased.

They also requested that any super not paid to their fund for the quarter be reversed back.  We pay quarterly super, so basically it meant repaying a certain amount back to the employee.

How do I now get the payment summary to reflect the correct total for salary sacrificed super, because as of now, it's including the amount I repaid back to the employee?

We are using Reckon Accounts Enterprise 2017.
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Felicity Van

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Posted 5 months ago

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Adrian

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Not real easy.

Need to inform the employee that they will also loose the tax benefit of the salary sacrifice, so they will not receive the total amount in their hand,as more will go to tax.

Discuss this with the employee first, before trying to adjust.

Adrian
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Felicity Van

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Hi Adrian,

Employee is aware of that & understood the consequences.  The adjustment has already been made in a pay.

My query was in regards to the reporting issue I now have on the payment summary.
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Kevin Whiting

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Danger!  It looks like you are abandoning "best practice" in an attempt to help the employee with cash-flow issues.  You should advise the employee that Sal Sac cannot be altered retrospectively i.e. after payslips have been issued.  You run the risk of having inconsistent records which might have unexpected consequences.  Even if the employee agrees to destroy the previous payslips, you should still regard these as permanent records that cannot be changed - are the originals sitting on an email server somewhere on the other side of the world?  In a worst case scenario, the ATO might regard the business as conspiring with the employee to reduce or delay PAYE remissions.
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Felicity Van

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I don't quite understand what you mean.  When adjusting the salary sacrificed amounts back, the correct PAYG withholding was deducted.  I haven't altered the previous pays, I paid it back in a new pay.

I created a new pay item called "salary sacrifice repaid" as an "addition" item.
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Kevin Russell, Accredited Partner

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You should be paying it monthly.