End-Of-Year-Payroll-Procedures-Carbon-Group-Bookkeeping-Perth

EOFY Processes For Payroll

Wrapping up the end of financial year can be a stressful time for many business owners and those responsible for ensuring accounts are finalised before the financial year comes to an end. But with the right processes and systems in place, payroll can be a breeze for businesses of any size or industry.

Below, we’ve highlighted a few key dates that you need to be aware of. As all these things need to be reported to the ATO, you need to ensure that your financial statements match your payment summaries and match the business activity statements (BAS) that you have lodged during the year. The ATO has sophisticated data-matching software that can easily pick up reports that do not match.

Key Dates For EOFY Payroll

• PAYG payment summaries (previously known as group certificates) are to be provided to all employees by July 14th
• PAYG withholding payment summary annual report must be with the ATO (showing amounts paid to all workers and the amounts withheld) by October 31st
• Superannuation for the fourth quarter (1st April to 30th June) needs to be received by the superfunds by 28th July

Best practice would be to incorporate these checks into your monthly/quarterly bookkeeping process, however at a minimum it should be done on an annual basis. It is very important as this will also ensure that your employees’ individual tax returns are not affected by inaccurate record keeping.

Payment of superannuation by the due date is very important not just at the end of the financial year. If superannuation is not paid by the due date, then technically you are in breach of the superannuation act and the payment of superannuation will no longer be a deductible expense for your business and you can also be subject to various fines, penalties and interest. The ATO has extraordinary powers when it comes to non-payment of superannuation and can go outside of corporate structures to recover the money from the directors’ personal assets (eg. the family home). Thus payment of superannuation by the due date should be a priority for your business.

Key Bookkeeping Terms

Financial Statements: A formal record of the financial activities of an entity that quantifies the financial strength, performance and liquidity of a company.

Business Activity Statement (BAS): A form submitted to the ATO by all businesses to report their taxation obligations, including GST, PAYGW, PAYGI and FBT.

Payment Summary: Summary of employees’ total PAYG withheld against gross earnings (salary/wages, commissions, bonus payments), as well as taxable deductions within a financial year.

Looking for assistance with your bookkeeping or EOFY processing? Contact the team at Carbon Bookkeeping to get started. Call (08) 9446 8588.

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