What you need to do with Payroll for year-end
With the end of the financial year approaching, follow these steps to ensure that your payroll and payroll summaries are in order.
- If you haven’t opted into Single Touch Payroll (STP), review your employee PAYG payment summaries – individual non-business.
- If you have opted into STP, sign off your STP data and send it to the ATO.
- Create summaries for labour-hire and some employment termination payments (ETPs).
If you’ve opted in to STP before 1 July 2020, you can’t produce payment summaries for the 2020 financial year. Instead, file a pay run in the 2019/2020 financial year and then finalise your STP data.
Before you begin
- If you’ve set up STP, you don’t need to file PAYG payment summaries. Instead, ensure that you finalise your STP data so the relevant information is automatically sent to the ATO.
- You can send or print summaries for ETPs – Type R or O. You need to manually produce summaries for labour-hire and other ETP types.
- You need payroll admin access to prepare payroll data for the end of the financial year.
Review payroll transactions
At the end of the financial year, reconcile your payroll to the general ledger and fix any errors. Ensure you’ve posted your last pay run for the financial year before continuing.
Reconcile payroll data with the general ledger
Run the Payroll Activity Summary report and make sure you select all employees and the financial year you’re checking.
Run the Trial Balance report, select the last date of the relevant period and sort by account name.
Use the following table to check your payroll data by matching the report balances in your Payroll Activity Summary report and the Trial Balance report:
|Matching report balances
|In your Payroll Activity Summary
|In your Trial Balance report
|Total Wages and Salaries
|Total PAYG Withholding Payable
If balances don’t match, check your pay run history to find the pay run with the error and process an adjustment.
Once all balances are correct, you need to review the payment summary amounts.
Review payment summary details and fix any errors
Run a Payment Summary Details report, select all employees and the financial year you’re checking before reviewing the amounts for each employee.
If you find any incorrect amounts in the payment summaries, you’ll need to fix these before you continue.
Once you’ve generated payment summaries for your employees, you can submit these to the ATO.
Setting yourself up for the new year
Financial year-end is the perfect time to do a payroll check-up, celebrate your successes, and refocus on business goals.