JobKeeper qualified - STP adjustment

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We have qualified for the JobKeeper subsidy for the month of April.
However STP was submitted for both pay runs in April already without any of the required new payroll items such JOBKEEPER-TOPUP / JOBKEEPER-START-FNXX.
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Thomas

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Posted 2 months ago

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Bruce

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Amend your last pay to include the JobKeeper transactions and then run the STP file again.   Make sure that you choose "full file replacement" - see top left immediately below the "pay date".   It is quite intuitive once you are in to GovConnect
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Thomas

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Thanks Bruce,
I had a lot more details in my question, but they all do not show up.
In the past I could edit my posts, but now this seems not possible anymore.

Anyway you have already answered some part of my question(s). - Thanks

So, I only need to re-enter the LAST pay cycle of April and not both April pay cycles. - Correct?

And since the second pay cycle of April (the one I need to re-enter) is Fortnight #2 of April, the payroll item that I need to add would be JOBKEEPER-START-FN02; and of course the payroll item JOBKEEPER-TOPUP for the topup that was paid.

But will we receive the full JobKeeper subsidy of $3'000 per eligible employee if we only submit the last pay run?

Thanks for your assistance.
(Edited)
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Jodie Porter

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From my understanding Thomas (please note I am a physio though), you should update the second payrun but put in JOBKEEPER-START-FN01 as otherwise it will just start you from fortnight 2 I believe. Apaprently for April it's OK to just have the FN01 in any of the payments but after that you need to have the fortnight
dates correct
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John Graetz

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Thomas.  You don't even have to go back into the last pay.  You can run an unscheduled pay to pay the top-up amount and adjust the tax to be deducted for the past four weeks.
START-FN01 is an indication that you want to claim the Government Allowance from the first fortnight in April.  You do not have to go back in your pays and do anything, if you run an unscheduled pay.  You have until 8th May to do this as the ATO has granted an extension in time.
If you run an unscheduled pay, you will lodge this through STP as a new pay event.
I went through the process that I have outlined above on Thursday.  Remember that you have to use JOB-KEEPER-START-FN01 for every employee for whom you are wanting to claim the allowance.  Ensure that the setup for the special Pay Items is as specified by Reckon - I note that your spelling above for the START-FN01 is not exactly as specificed in Reckon instructions.
John L G
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Bruce

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Thomas
John's comments are correct.   

MOST IMPORTANT are his comments about:
- using exactly the same spelling/format as specified by for the JobKeeper pay items. 
- using FN01 to show the ATO that you are claiming JobKeeper from the first fortnight (if you use FN02, you will not get reimbursed for the first fortnight)
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Thomas

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Thank you John and Bruce; really appreciate your assistance here.

Please note ALL payments to ensure the eligible employees have received the required minimum of $3'000 during the month of April have been made during the second April pay cycle paid on April 27. Since most employees already receive more than $1'500 per fortnight, only 3 employees needed a top up, and that was paid with the wage payment on April 27.

This means no additional top up is required anymore for the month of April; everybody fulfills the JobKeeper Conditions. All the remains to be done is the STP adjustment report so that we are recorded with the ATO for the April JobKeeper subsidy of $3'000 per staff.
.
John, would you be so kind and elaborate on your proposed process? I am not quite sure I understand the mechanics of the 'unscheduled pay run' and the necessary tax adjustments.

Thank you so much for your continued support.

(Edited)
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John Graetz

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Thomas.  I did not realise from what you had said that you had already made the top up payment for the 3 employees.  What I meant regarding the tax aspect was, that ideally you should have gone through a process of making sure that these 3 employees were not overtaxed.  Unless you made adjustments, they would have been taxed on up to $3,000 in that 27th April pay as if it had all happened in that specific fortnight.  When you have lump sum payments like this, the ideal treatment goes something like this:
1. What is the tax on $1,500 per fortnight
2.  What therefore is tax on two fortnights.  This gives you their taxable payment for the four weeks
3.  Determine the amount of tax deducted already from the first fortnight.  Then deduct this from the answer in 2 and adjust the tax that Reckon thinks it should take out.  As you have already made the payment, it is too late to do this, meaning that for the moment, these 3 employees have potentially had more tax deducted than was needed.  If this has happened, they will get it back when they do their tax return.  The more topup backpay they received, the greater the likely overtaxing.
I had assumed from what you had said that you had not yet put through any of the JobKeeper codes or top up, hence why I was suggesting that you cater for this by using an Unscheduled Pay instead of a Scheduled Pay (Pay Emloyees> Unscheduled Pay).
If you have not already used JOBKEEPER-TOPUP for your 3 employees, you need to change your pay details to accommodate this.  Then you have to ensure that the payroll item JOB-KEEPER-START-FN01 is added to all of your employees in that 27th April pay run, so that the ATO knows that this is the start fortnight for each of your employees.
Also note that from now on for your 3 employees, you have to continue to use the item JOBKEEPER-TOPUP for each of them to reflect the amount that you are topping up to the $1,500 level each fortnight.
You are nearly there - happy sailing!
John L G
(Edited)
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Thomas

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Thank you very much John; now it becomes more clear.
We are aware that we possibly over paid some taxes and everybody is fine with that.

The remaining issue is to ensure the STP reports are updated, because none of the payments made in April were done with any of the JobKeeper payroll items.

I trust we need to re-enter the Reckon payments and submit new STP reports.

May I kindly ask you for your advise on these questions:

1. What to do with employees that only reached wage payments of $3'000 for the month of April during the 2nd wage payment of April?
1 a) Do I need to reprocess both April wage payments with the JobKeeper payroll items, although the first fortnight wage payment was below $1'500; or
1 b) Can we only reprocess/resubmit the STP for employees that reached the fortnightly limit of $1'500 during the 2nd April fortnight (irrespective of reaching $3'000 within April due to topups)? - And would the JobKeeper code for this 2nd April fortnight be JOB-KEEPER START-FN02 (FN numbering by FN date) or JOB-KEEPER-START-FN01 (first JobKeeper subsidy for the employee)?

2. We have one staff that is still on PPL (Paid Parental Leave). She is eligible for JobKeeper, but it is my understanding that we can only process her wages with the JobKeeper payroll item JOB-KEEPER-START-FNxx once she is off the PPL subsidy. During the PPL period her wage process into Reckon has to be done without any JobKeeper payroll items. - Is my assumption correct?

Thank you so much for your most valuable recommendations in this complex manner.
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John Graetz

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Thomas.  These are the facts in your situation:
1.  You pay your employees on a fortnightly basis
2.  The comments on this scheme and the actual legislation talk about making a minimum payment to each employee of at least $1,500 per fortnight NOT $3,000 for the four week period in April.  The only reason that the figure of $3,000 has been used is because that is the cumulative minimum figure for the month of April based the the ATO fortnight dates.
3.  In answer to your question 1a, you have to assess each fortnightly pay independently.  That is, if you have employees who earned less than $1,500 in Fortnight 01, you have to top them up to $1,500 for that fortnight, or you will be in breach of the rules.
4.  If employees earned in excess of $1,500 in any/either fortnight, then there is no top up involved because they passed the minimum payment threshold of $1,500 in that fortnight.
5.  Question 1b appears to be irrelevant, based on what I have said because each fortnight is treated in isolation - if they didn't reach $1,500 in any fortnight period, they need to be topped up to $1,500 in that particular fortnight.
6.  In general, each of your employees is entitled to a top up, if needed, if you are an eligible employer.  Apart from that, you, as an eligible employer, are able to claim $1,500 for each employee.  For those earning more than $1,500 in a fortnight, you get to keep all of it.  For those earning less that $1,500 you will also get $1,500 for them as you will have topped up their payment to the minimum of $1,500 in a fortnight.  This is a subsidy that you get by paying each employee a minimum of $1,500 in each fortnight.
7.  If you are claiming under the scheme from Fortnight 01, EVERY employee must have JOB-KEEPER-START-FN01 entered into one of your pays to indicate to the ATO that you are claiming from Fortnight 01.
8.  For the PPL employee, she is not eligible for Topup until such time as she finishes per PPL period.  That means that when she starts and becomes eligible for topup, you might be indicating to the ATO that the Start might be say START-FN04 if that was the period in which she starts to get topup.

At this stage I am not going to enter into a discussion as to which pays need to be resubmitted to STP because it appears that you might not have understood the rules and consequently it is far too confusing to offer comment at this stage.  Suffice to say, if you make any changes to your pay details for either of your two pays, you will need to resubmit.

If anybody else wishes to comment on this, I am sure that they will do so
John L G

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Thomas

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Dear John,
Thank you for your great patience and detailed reply. Your answers have confirmed what I assumed to be the correct approach. - Once again you have help to solve another case for me :-). - Thank you!

I will now re-enter every employee's first wage (starting from FN01) where they reach or exceed the minimum fortnightly pay of $1'500 with the relevant JobKeeper payroll item(s).
After I have done that I will upload the entire pay run under 'full file replacement'.

Can you please double check the Payroll Item Code spelling.
In your initial post you made a remark that my spelling is not exactly as specified by the Reckon instructions. - I have taken the spelling from the Reckon website:


Thanks
Thomas vA




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John Graetz

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Thomas.  You are correct.  I believe that I followed the instructions exactly, but now cannot find what I have stated unless the START code spelling has been amended.  There is now definitely no hyhpen - it is now definitely JOBKEEPER-START-FN01.  Sorry about that.
John L G
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Thomas

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No worries, John.
I only tried to be a little bit helpful to you, after all the help you have provided to me.
Thanks a lot.

Thomas vA