Payroll year end processing

This tutorial demonstrates how to finalise the payroll using Single Touch Payroll.

1. Payroll finalisation on final pay

If you are doing the last pay for the financial year. Simply flag the box "Final pay for financial year" as yes. This is on each pay slip. Then lodge as normal.

I didn't mention in the video but if you have employees that are not being paid in the final payroll batch for the year then just add a pay slip for them with no pay on it and flag that as the final pay. This is basically the process in the update event that I demonstate next.

2. Payroll finalisation using update event after year end

If you did not flag the last pay slip in the financial year as final or you have to adjust the amounts then you need to lodge an update event. This is basically the same process but there is no gross or net pay on the pay slip(s).

Also note that the batch should have all dates set to 30 June, i.e. payment date, from date and to date.

Note that if you are doing the pay event because you need to correct the amounts notified to the ATO you will need to enter a separate pay slip to correct the amounts. You cannot correct it on the update event pay slip as the update event pay slip has to have zero gross and tax.

Tip: To do the update event dated 30 June you need to wait until the 30th of June or later. It's supposed to be lodged before 14 July. For 2020 year end if you have 19 or less employees it's due on 31 July.

Tips to make sure the numbers are correct

  1. On the batch transaction list page the software now shows you the YTD totals and the total for all employees at the bottom. Check that this adds up to the total on the payroll summary report. This makes sure that you have included all employees. There can be differences though and these can arise because

    • You previously finalised an employees pays (e.g. they resigned part way through the year). So that employee is not on this batch.

    • You have some tax free allowances like reimburements of expenses.

  2. Make sure that the total add up to the total on the BASs for salaries and tax withheld. Although you may not have submitted that final BAS yet it can be generated without lodging.

  3. If you are using BAS Off, reconcile your bank account. This ensures that the amounts balance with what you have actually transferred out of your bank account.

Note that Job Keeper changed things a bit because it's a taxable allowance. I.e. it's in the allowances column but it is a taxable allowance.