BAS Report PAYG Withholding Calculation Error

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In Reckon Accounts, PAYG Withholding at Box W2 on the Simple BAS/IAS report deducts payments made to ATO during the period, which is deducted from the Total PAYG actually owed to ATO, giving a dramatically understated amount. 
This has apparently been going in Reckon for quite a number of years, Reckon has neither admitted nor rectified the problem.

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Peter Kershaw

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Posted 3 weeks ago

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Glenda Veale

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I know, very annoying.  I have to change the figure manually each quarter.

Hi Peter

I agree with John that you need to use the "Pay Liabilities" method for the above, however you don't need to create 2 separate transactions if you are paying multiple liabilities in one.

 

  • Generate the payment for the PAYGW component via "Create Custom Liability Payments"

This auto-populates the Liability Cheque with the PAYGW payable Payroll Item on that tab

  • Simply click on the Expenses tab & - on separate lines - select any other liabilities & their amount(s) in that payment (eg GST Payable, PAYG Instalments, FBT Payable etc)
  • Click on the Recalculate button at the bottom of the window to update/refresh the Cheque total

 

This then matches your ATO payment in full whilst correctly picking up/posting to all your liabilities, including payroll.  You can also enter separate line Memos to identify the components as well as a main Memo.

(Apologies for the double post - the Edit & Remove buttons are no longer there!)
(Apologies for the double post - the Edit & Remove buttons are no longer there!)
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Glenda Veale

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I have always thought that we had to enter BAS payments through the Pay Tax area.  This will save me a lot of hassle if I can do it this way.  Thank you.
Happy to help Glenda :)

The "Pay Tax" area is simply a pre-filling shortcut to "Write Cheque".  However, it should really be called "Pay GST" as when your BAS payment comprises ONLY of GST then yes, that is the correct way to enter it. 
The problem with "Write Cheque" though - as you've discovered - is that:
1.  It doesn't allow for selection of Payroll Items              ...... which then creates ....
2. Incorrect figures in your integrated BAS (this is because the W1 & W2 configuration labels are account-only options for selection, not Payroll Items.  The PAYGW liability has been accrued via a Payroll Item - The system doesn't include any Payroll Liability Payments at W2 as it recognises that type of transaction as being for payments against prior accrued liability amounts)

You will find your payroll liability accounts & W2 prefill are much more accurate if you use the Liability Cheque method when necessary. 
(Edited)