Paying Several Employees With One Payroll Payment

MYOB and Xero now make payroll easier to manage

myob and xero online payroll management
Struggling to manage your online payroll management? Our Xero and MYOB courses will help you get the most out of this software so you can manage payroll in house.

MANY COMPANIES OUTSOURCE PAYROLL because it contains many moving parts. For instance, there’s the payment of wages each week or fortnight or month, sure. But there’s also superannuation contributions, PAYG obligations, annual and sick leave accrual. 

Fortunately, most accounting apps like Xero and MYOB have made payroll easier to manage, particularly if you only have a handful of employees.

Superannuation clearing houses

Nearly every major cloud accounting package has a connected superannuation clearing house within its payroll package. Xero and MYOB are both SuperStream compliant, a government initiative to help business owners tell which accounting software apps will let them make electronic superannuation payments. And QuickBooks uses a partner payroll system which is also SuperStream compliant.

Batch wage payments

Electronic superannuation payments are one way that paying staff is made easier, but paying a dozen or so employees individually each week or fortnight can be tedious. Fortunately, both Xero and MYOB have a ‘pay run’ function that lets you make batch wage payments. This eliminates the tedium of paying employees individually, as well as the potential for error.

Accounting software calculates entitlements

MYOB, Xero and QuickBooks, if you’ve set up your employees correctly and have the appropriate payroll subscription, will also calculate your employees’ sick and annual leave entitlements, also reducing the time it takes to process payroll and the potential for error.

Our MYOB training courses and our Xero training courses both cover payroll, where you’ll learn how to set up employees correctly, process wage payments and more. Using a cloud accounting program for payroll, saves time and reduces errors. Visit our website for more information.

EzyLearn courses now include real life case studies

managing ad hoc payrollAt EzyLearn we are constantly refreshing the content of our online training courses. Relevant to those of you doing Payroll, might be our Excel Ad Hoc Payroll case study which is part of our Intermediate Excel Online Training Courses. Where possible, we draw on real-life case studies as examples, to help you learn, and apply your skills, in a relevant way that makes sense. Visit our Micro Courses page to learn more.


 

Calculating PAYG Obligations Without a Payroll System

Third Quarter is Looming; Are You Up to Date with Payroll?

ad hoc payroll payments ExcelMost businesses using an accounting program like MYOB or Xero will use the included payroll package to manage their employees’ payroll. For businesses with only a few employees, however, the additional payroll function is an unnecessary expense.

In our recently updated Advanced Microsoft Excel training courses, we have included a micro course on ‘Ad Hoc Payroll’, featuring a detailed spreadsheet for calculating PAYG and superannuation obligations. In this instance, our micro course is a detailed spreadsheet based on a case study, so it’s relevant and applicable to real life.

PAYG and the businesses it applies to

Every Australian business with employees who are each paid more than the tax-free threshold has a legal obligation to withhold tax on their employees’ behalf. This is known as the PAYG System (or Pay As You Go), where amounts of tax are withheld from each employee’s wage payments.

Businesses that withhold up to $25,000 each year only need to make payments to the ATO each quarter; businesses withholding amounts greater than $25,001 may have to make payments to the ATO each month or as regularly as each week.

At the time of writing, the tax-free threshold is currently $18,200, which is equivalent to:

  • $350 a week
  • $700 a fortnight
  • $1,517 a month

Superannuation contributions

Again, any business that pays its employees more than $450 each month must also make regular superannuation contributions on their employees’ behalf. We’ve written in the past about the government’s clearing house called SuperStream, which allows you to easily make super contributions — for free.

But first, you need to work out how much super you need to contribute for your employees. The superannuation guarantee is currently 9.5 percent of your employees’ gross wages, which is payable on top of their wages — not deducted out of.

Using tax tables to calculate wages

Each year, the ATO produces a range of tax tables to help you work out how much to withhold from payments you make to your employees. In our Ad Hoc Payroll Micro Course, we’ve already added the most current tax tables to the accompanying payroll spreadsheet, as well as the superannuation guarantee tables.

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We feature a number of real-life case studies, which we have turned into micro courses. You can use the Ad Hoc Payroll Micro Course to determine the rate of PAYG tax to withhold and the required super contribution amounts in Excel, rather than paying to access the payroll functions of MYOB or Xero. Our Intermediate Microsoft Excel training courses will also teach you how to create a payroll spreadsheet from scratch to suit your own business. Visit our website for more information on all of our Excel training courses.

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online bookkeeping courses to earn cpd points

 

EzyLearn Excel, MYOB and Xero online training courses count towards Continuing Professional Development (CPD) for bookkeepers and accountants. We’ve been an accredited training provider of the Institute of Certified Bookkeepers ever since the organisation started in Australia. Find out how CPD points can be of benefit to you.

 

 

 

 

 

If you have fewer than 19 staff you must be SuperStream Ready by June 30

Companies with over 20 employees should ALREADY be compliant

ATO SuperStream for myob and xero accounting software training coursesIn July last year, EzyLearn published a couple of posts about SuperStream, the government initiative to improve the efficiency of Australia’s superannuation system, which all businesses with 19 or fewer employees must be compliant with by June 30 this year. As we’ve now reaching June 30, it’s important to ensure that you’re fully compliant with SuperStream, the government’s electronic system for sending superannuation payments to your employees’ super funds.

If you’re already using a payroll system to pay super and send your employee information, then you may only need to alter your system slightly to ensure you’re compliant. If you don’t currently send super and employee information electronically, then you’ll need to implement a system for doing so – and as soon as possible.

Get compliant by using a SuperStream certified payroll system

If you currently use one of the major cloud accounting programs, such as MYOB AccountRight or Xero, they’re already SuperStream compliant – both have been gold certified, meaning they conform to all of the testing requirements for all data and messaging for SuperStream. As long as all of your employee information is current and accurate, then you’re already SuperStream compliant. It’s now just a click of a button in your accounting software to create the super fund report, which, along with the money, is sent through to each super fund.

If you’re not using a SuperStream compliant payroll system

If you don’t use MYOB AccountRight or Xero or another SuperStream compliant accounting package – or the version of MYOB you’re using isn’t up-to-date – then you can use the government’s Small Business Superannuation Clearing House, which is free for businesses with 19 or fewer employees and an aggregated turnover below $2 million per annum.

This will involve a few extra steps in the payroll process, and also involve some double handling of certain information, but it’s still an incredibly simple process to follow to ensure you’re sending your employees’ super contributions electronically.

If you currently use a bookkeeper, however, the double handling of information may make it less cost effective to use the government’s Small Business Superannuation Clearing House, as opposed to upgrading your accounting software to a compliant system, like Xero or MYOB AccountRight.

Check out this great video that explains from the horses mouth how SuperStream works and give you a checklist of things to do to see if you are compliant.


To find out if your current payroll system is SuperStream compliant, visit the ATO website, or ask your bookkeeper or accountant.

For training in SuperStream compliant payroll systems

If you decide to upgrade or adopt a SuperStream compliant one, and you’d like training in how to use it correctly, EzyLearn offers both MYOB training courses (which includes payroll) and Xero training courses, delivered completely online. Otherwise, for more small business news, tips and insights subscribe to our blog.

Good local bookkeepers

Start a bookkeeping business not a franchiseAs bookkeeping tasks become more complicated and require more compliance you may find it better to use the services of an experienced bookkeeper who provides their services on a contract basis when you need them. If you want to find a local bookkeeper be sure to check out great bookkeepers at our bookkeeping directory National Bookkeeping. If you are a great bookkeeper and want to get more exposure and join a collaborative marketing team feel free to Pre Qualify and tell us about yourself.

Is your compulsory super about investing or saving?

We recently wrote about the yearly returns that APRA (the governing body for the financial services industry) announces to showcase the rate of return of the top 200 superannuation funds. This information forms part of our new Bookkeeping Academy for continuing professional development (CPD). 

It prompted a question in our think tank about the purpose of superannuation and whether it should be used as a tool for investing in equity?

The problem with equity is that there is no guarantee of return and its value is completely dependent on the performance of the company. Even things like dividends are only paid at managements discretion. Interest on the other hand must be paid and the capital returned to the investor at the end of the term. In the event of a liquidation, debt is repaid first and it is usually secured by something.

It all really depends upon your personal circumstances but we found a product on the market that seemed to fit very well with the thinking of the concept of super. It is the Commonwealth Banks Superannuation Savings Account. It earns interest which  might not be as impressive as equity, but this is only 10% of your income and it goes along with the adage from the Richest Man in Babylon…  Make thy gold multiply.

In the end, as Financial Planners will attest, the decision you make depends upon your risk appetite and your investment time horizon, but one thing is certain – you must have super as an employee and pay it as an employer. Stay tuned for the news about our MYOB Payroll Level 2 course where we go into more detail about how to manage the paying of staff. All new content generated for our online MYOB training courses is available to existing students as part of their lifetime access.

 

Statement of formulas for calculating PAYG amounts to be withheld

PAYG withholding Scale 7 for weekly wage payments for online MYOB training course and supportThe MYOB Payroll Training Course is in stage two of development. The contents of our existing Payroll course give students an introduction to how to navigate around and get fundamental information about the payroll environment in the sample company file. As part of our constant improvement process we are developing payroll scenarios as exercises for our students. This new content when published will be available for all existing Payroll Students and all those who have enrolled with the LIFETIME training course Access option.

Which table to use?

The ATO release papers that provide you with the information you need to perform your calculations regarding PAYG, super etc. In this blog post we look at Schedule 1 Pay as you go (PAYG) withholding NAT 1004. If you take a look at table 7 on page (see diagram on this page) you’ll see the variables or what the Australian Tax Office call coefficients.

New Spreadsheet for Excel and MYOB students

One of our content creators is in the process of creating an Excel spreadsheet as a simple tool to help you work out how much PAYG tax and super you owe at the end of quarterly BAS reporting period. It’s a tool that we will offer both Microsoft Excel and MYOB Training Course students when it’s ready. And no, before you think of asking, it won’t cost you any extra money to receive it. It’s available as part of our LIFETIME student access.