Create a Negative Pay in Reckon Hosted

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  • Updated 2 months ago
We have a client who is a sole trader and was paying themselves wages.  As a sole trader can't pay wages, we need to reverse their payruns for every quarter. Is it possible to do a negative payrun? I could put in minus hours, but the payg tax needs to be a positive and I could not figure out how to do that?
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Jo Marshall

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Posted 2 months ago

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Linda Putland, Accredited Partner

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Hi Jo - I would create a new Addition pay item and call it Drawings - connect it to an equity account called Drawings - do not tick for PAYG or super... then Unlock and edit each pay that has been processed - delete every line and add in the Drawings item for the Net amount of that pay - this will replace what was there before and put the payment to drawings, without the need to mess up the bank reconciliations?
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Jo Marshall

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Hi Linda. thank you for your response. That would take the wages out of wages, but how do we adjust the PAYG that was paid. It now actually needs to be refunded to them? We will need to amend BAS - that is why I wanted to put through a negative pay run to reduce the wages and reflect the negative PAYG?
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Linda Putland, Accredited Partner

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Are they paying wages to other staff too?  if so... then make the net amount they were paid the drawings - then when the wages are adjusted and you look at W2 amounts paid so far this year versus W2 amounts now owing after the amendments - you will be in credit - so this can be reflected by a reduced PAYG payment on your next BAS?
If the amount of the PAYG is less than $5k then both W1 and W2 for June's BAS can bring the total W1 and W2 reported into line for the whole year... if the amount of the PAYG to be corrected is more than $5k - then you should probably rerun the reports and amend the various BAS lodgements to show the corrected amounts... any excess paid can be applied to new BAS lodgements.
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Jo Marshall

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Hi Linda
This does make sense, but won't the STP reporting be incorrect?
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Jo Marshall

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I am wondering how to get this fixed?  Surely There must be a way to do this.
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Glenda Veale

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I think Linda gave you the necessary steps above.  Then when you upload your next stp it will update.