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Pay Types Explained
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Pay Types Explained

 

Pay Types, which consist of pay rates, Allowances, and Deductions, facilitate processing Payees' payments within a pay run.

 

Single Touch Payroll Phase 2 allows these Pay Types to be disaggregated from Gross, reported to the ATO as separately itemised components within the Income Stream Collection (where applicable), and then passed to multiple Government Agencies. This reporting method also assists in administering the Social Security system.

 

Due to the stringent requirements surrounding payments, we have pre-configured System Default Pay Rates, Allowances, and Deductions based on the ATO's documentation. This also affects the changes you can make when each of these is copied. We have preconfigured these Pay Types for you to help with these new reporting obligations and remove the complexity. We have outlined several different Awards in the system default pay types documentation as examples of when these payments may be applicable. Still, the Pay Types listed may apply to numerous other Awards.

System Default Pay Types Explained

 

 

System Default, User Modified, and All Pay Types filter the results shown in the Pay Types List. By default, System Default is selected.

 

Search enables you to enter information to filter the results shown in the Pay Types List.


The Pay Types List displays the Description, Payment Type, Category, Income Stream, Database Type Code, Value, Paid By and Status.

🎯 We've included the ability to change the sort order by selecting the relevant arrow in the Table Headings.

 

The Actions Button enables you to perform the following actions based on the Pay Type selected;

  1. If a System Default Pay Type is selected, you can Copy or View
  2. If a User Modified Pay Type is selected, you can CopyEdit or View

Showing X to X of X entries. Show X entries allow you to select how many Pay Types you would like displayed per page.

 

Pagination Controls allows you to navigate between the Pay Types pages.


System Default Allowances

Allowances, along with the required pay rates and deductions, are used as pay lines when processing a Pay Run. We have provided the most commonly required Allowances as System Defaults (Templates) that can be used "as is" or copied and modified to suit your requirements. Allowances are separated into their own category for ease of use and split into two categories: Reportable and Non-Reportable.

 

With Single Touch Payroll Phase 2, there have been significant changes to the reporting of Allowances. In STP Phase 1, some Allowances were reported as part of Gross, and others were reported separately. 

All Allowances are now reported separately using the following codes in STP Phase 2: Please refer to the ATO for detailed guidance for separately reported Allowance Types.

 

STP Phase 1 Code STP Phase 1 Description STP Phase 2 Type Code STP Phase 2 Description
CAR Car expense. CD Cents per Kilometre.
TRANSPORT Award Transport. AD Award Transport Payments.
LAUNDRY Laundry Allowance. LD Laundry Allowance.
MEALS Overtime Meal Allowance. MD Overtime Meal Allowance.
TRAVEL Travel Allowance. RD Travel Allowance.
OTHER Other Allowance. OD Other Allowances.
    TD Tool Allowance.
    KN Task Allowances.
    QN Qualification Allowances.

Allowances

Description W1 (Total of Salary, Wages & other payments);     Taxable OTE (SGAA) Allowance Type Code (PAYEVNTEMP7) Other Allowance Description (PAYEVNTEMP8) Reported as

Award Transport Allowance

Yes No No AD   Allowances*
(PAYEVNTEMP226)

Car - Cents per Kilometre (≤ Approved Rate & ≤ ATO Measure)

Yes No No CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (≤ Approved Rate & > ATO Measure) (S&W) Yes Yes No CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (≤ Approved Rate & > ATO Measure) (S&W & OTE) Yes Yes Yes CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (> Approved Rate & ≤ ATO Measure) (S&W) Yes Yes No CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (> Approved Rate & ≤ ATO Measure) (S&W & OTE) Yes Yes Yes CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (> Approved Rate & > ATO Measure) (S&W) Yes Yes No CD   Allowances* (PAYEVNTEMP226)
Car - Cents per Kilometre (> Approved Rate & > ATO Measure) (S&W & OTE) Yes Yes Yes CD   Allowances* (PAYEVNTEMP226)
Supplemental, Industry, Disability, Tasks, Activities and Skill Level Allowance (S&W) Yes Yes No KN   Allowances* (PAYEVNTEMP226)

Supplemental, Industry, Disability, Tasks, Activities and Skill Level Allowance (S&W & OTE)

Yes Yes Yes KN   Allowances* (PAYEVNTEMP226)
Laundry Allowance (Approved Uniform, ≤ ATO Measure) Yes No No LD   Allowances* (PAYEVNTEMP226)

Laundry Allowance (Approved Uniform, > ATO Measure)  (S&W & OTE)

Yes Yes Yes LD   Allowances* (PAYEVNTEMP226)

Overtime Meals Allowance (> ATO Measure)

Yes Yes No MD   Allowances* (PAYEVNTEMP226)
Laundry Allowance (Conventional Clothing) (S&W & OTE) Yes Yes Yes OD General Allowances* (PAYEVNTEMP226)
Overseas Accommodation Allowance (S&W) Yes Yes No OD General Allowances* (PAYEVNTEMP226)

Overseas Accommodation Allowance (S&W & OTE)

Yes Yes Yes OD General Allowances* (PAYEVNTEMP226)
Home Office Allowance (S&W) Yes Yes No OD Home Office Allowances* (PAYEVNTEMP226)

Home Office Allowance (S&W & OTE)

Yes Yes Yes OD Home Office Allowances* (PAYEVNTEMP226)

Award Transport or Fares Allowance (Private Purposes) (S&W)

Yes Yes No OD Non-deductible Allowances* (PAYEVNTEMP226)
Award Transport or Fares Allowance (Private Purposes) (S&W & OTE) Yes Yes Yes OD Non-deductible Allowances* (PAYEVNTEMP226)
Domestic Travel Allowance (Non-LAFH / Private Purposes) (S&W) Yes Yes No OD Non-deductible Allowances* (PAYEVNTEMP226)
Domestic Travel Allowance (Non-LAFH / Private Purposes) (S&W & OTE) Yes Yes Yes OD Non-deductible Allowances* (PAYEVNTEMP226)
Laundry Allowance (Private Purposes) (S&W & OTE) Yes Yes Yes OD Non-deductible Allowances* (PAYEVNTEMP226)
Overseas Accommodation Allowance (Private Purposes) (S&W) Yes Yes No OD Non-deductible Allowances* (PAYEVNTEMP226)
Overseas Accommodation Allowance (Private Purposes) (S&W & OTE) Yes Yes Yes OD Non-deductible Allowances* (PAYEVNTEMP226)
Overseas Meals & Incidentals Allowance (Private Purposes) (S&W) Yes Yes No OD Non-deductible Allowances* (PAYEVNTEMP226)
Overseas Meals & Incidentals Allowance (Private Purposes) (S&W & OTE) Yes Yes Yes OD Non-deductible Allowances* (PAYEVNTEMP226)
Other Vehicle - Cents per Kilometre (S&W) Yes Yes No OD Private Vehicle Allowances* (PAYEVNTEMP226)

Other Vehicle - Cents per Kilometre (S&W & OTE)

Yes Yes Yes OD Private Vehicle Allowances* (PAYEVNTEMP226)
Award Transport or Fares Allowance (S&W) Yes Yes No OD Transport/Fares Allowances* (PAYEVNTEMP226)

Award Transport or Fares Allowance (S&W & OTE)

Yes Yes Yes OD Transport/Fares Allowances* (PAYEVNTEMP226)
Private Purpose - Cents per Kilometre (S&W) Yes Yes No OD C/Km Home to Office Allowances* (PAYEVNTEMP226)

Private Purpose - Cents per Kilometre (S&W & OTE)

Yes Yes Yes OD C/Km Home to Office Allowances* (PAYEVNTEMP226)
Uniform or Grooming Allowance (S&W) Yes Yes No OD Uniform Allowances* (PAYEVNTEMP226)

Uniform or Grooming Allowance (S&W & OTE)

Yes Yes Yes OD Uniform Allowances* (PAYEVNTEMP226)
Qualifications, Certificates, Licence Fees and Insurance Allowance (S&W) Yes Yes No QN   Allowances* (PAYEVNTEMP226)

Qualifications, Certificates, Licence Fees and Insurance Allowance (S&W & OTE)

Yes Yes Yes QN   Allowances* (PAYEVNTEMP226)
Domestic Travel Allowance (> ATO Measure) (S&W) Yes Yes No RD   Allowances* (PAYEVNTEMP226)
Domestic Travel Allowance (> ATO Measure) (S&W & OTE) Yes Yes Yes RD   Allowances* (PAYEVNTEMP226)
Overseas Meals & Incidentals Allowance (> ATO Measure) (S&W) Yes Yes No RD   Allowances* (PAYEVNTEMP226)

Overseas Meals & Incidentals Allowance (> ATO Measure) (S&W & OTE)

Yes Yes Yes RD   Allowances* (PAYEVNTEMP226)
Tools Allowance (S&W) Yes Yes No TD   Allowances* (PAYEVNTEMP226)

Tools Allowance (S&W & OTE)

Yes Yes Yes TD   Allowances* (PAYEVNTEMP226)
Overtime Meals Allowance (≤ ATO Measure) No No No Not reported in STP Phase 2
Overseas Meals & Incidentals Allowance (≤ ATO Measure) No No No

Domestic Travel Allowance (≤ ATO Measure)

No No No

 

For the Allowances that are considered Taxable, PAYGW is calculated per the applicable Taxation Schedule (Tax Scale) based on the Payees Tax Treatment & Tax Treatment Code,

 

Payee Tax Treatment PAYGW is calculated per
Regular

Schedule 1 – Tax Scale 1 (NAT 1004)

Schedule 1 – Tax Scale 2 (NAT 1004)

Schedule 1 – Tax Scale 2, TFN 333-333-333 ((NAT 1004)

Schedule 1 – Tax Scale 5 (NAT 1004)

Schedule 1 – Tax Scale 6 (NAT 1004)

Seniors and Pensioners

Schedule 9 – Member of a Couple (Full Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Member of a Couple (Half Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Member of a Couple (NAT 4466)

Schedule 9 – Member of an Illness Separated Couple (NAT 4466)

Schedule 9 – Member of an Illness Separated Couple (Full Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Member of an Illness Separated Couple (Half Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Single (Full Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Single (Half Medicare Levy Exemption) (NAT 4466)

Schedule 9 – Single (NAT 4466)

Working Holiday Maker

Schedule 15 - Working Holiday Maker (NAT 75331)

Schedule 1 – Tax Scale 3 (NAT 1004)

Schedule 1 – Tax Scale 4 (NAT 1004)

 

No TFN

 

Schedule 1 – Tax Scale 4 (NAT 1004)

Foreign Resident Schedule 1 – Tax Scale 3 (NAT 1004)
Seasonal Worker Programme Seasonal Worker Programme and Pacific Labour Scheme
Horticulturists and Shearers Schedule 2 – Tax table for individuals employed in the horticultural or shearing industry (NAT 1013)

 


System Default Deductions

Deductions, in addition to the required pay rates and allowances, are used on pay lines when processing a Pay Run. We have provided the most commonly required Deductions as System Defaults (Templates) that can be used "as is" or copied and modified to suit your requirements. 

 

For ease of use, Deductions are separated into two categories: Salary Sacrifice - decrease the Payees Gross Pay (before PAYGW is calculated) and After PAYGW - decrease the Payees Net Pay (after PAYGW is calculated).

 

Single Touch Payroll Phase 2 has resulted in changes to the Deductions reporting. Previously, only salary sacrifices for superannuation were itemised separately. 

An * indicates a Tuple; else, it is a Fact within the STP file used when reporting to the ATO.

 

Description Include in W1 (Total of Salary, Wages & other payments); Taxable OTE (SGAA) Salary Sacrifice Type Code
(PAYEVNTEMP266)
Deduction Type Code
(PAYEVNTEMP10)
Reported as

Salary Sacrifice (to Super Fund, OTE)

Yes

Reduces Gross

Yes

Reduces Gross

Yes S   Salary Sacrifice
(PAYEVNTEMP265)*
Salary Sacrifice (to other benefit)

Yes

Reduces Gross

Yes

Reduces Gross

No O   Salary Sacrifice
(PAYEVNTEMP265)*
Salary Sacrifice (to other benefit, OTE)

Yes

Reduces Gross

Yes

Reduces Gross

Yes O   Salary Sacrifice
(PAYEVNTEMP265)*
Salary Sacrifice (to Workplace Giving)

Yes

Reduces Gross

Yes

Reduces Gross

No O   Salary Sacrifice
(PAYEVNTEMP265)*

Salary Sacrifice (to Workplace Giving, OTE)

Yes

Reduces Gross

Yes

Reduces Gross

Yes O   Salary Sacrifice
(PAYEVNTEMP265)*
Child Support Garnishee No No No   G Deduction
(PAYEVNTEMP227)*
Child Support Deduction No No No   D Deduction
(PAYEVNTEMP227)*
Union Fees No No No   F Deduction
(PAYEVNTEMP227)*
Workplace Giving No No No   W Deduction
(PAYEVNTEMP227)*
After Tax Deduction No No No Not reported in STP Phase 2

After Tax Superannuation Contribution

No No No

 

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