Overwriting the Super amount gets reported in RESC on payment summary.

Legacy KB ID: 3759

Question

Why when I overwrite the Super amount when preparing pays, the amount gets reported in the RESC field of the Payment Summary?

Answer

The Australian Government requires you to report any payments of super in excess of the 9% Super Guarantee (SA) or an approved collective agreement rate (CA) separately on the payment summary in the RESC field. 

QuickBooks will automatically report some super payroll items to RESC – super salary sacrifice (SS) and employer additional (EA)

QuickBooks has a preference setting that when checked will automatically calculate and report amounts outside the statutory or collective rates to RESC.  If the amount you are entering for Super is different to these rates, then the difference will be reported to RESC on the payment summary.

Reckon acknowledges that the automatic calculation function for SA and CA will report any difference whether that amount is greater or less than the 9% or collective agreement rate.  It should report only amounts greater than the 9% or collective agreement rate.  This problem is being investigated.

 

Solution

You must first understand why you need to alter the amount of Super as QuickBooks is configured to calculate the correct amount of Super.  Common reasons you may want to do this are:

  • The Super item is incorrectly configured;
  • Other payroll items are impacting on Gross Payments leaving a lower amount to calculate super on;
  • Correct an overpayment in a previous pay.

 

Your first step is to verify that all items are correctly setup and being used in the correct manner.

1.    Super Items

a.    The correct super type is selected:

                                          i.    SA for the 9% Super Guarantee;

                                         ii.    CA for approved collective agreement amounts;

                                        iii.    EA for Employer Additional amounts (reports to RESC);

                                       iv.    SS for Super Salary Sacrifice (reports to RESC);

                                        v.    MV for additional super contributions made by the employee from after-tax pay (member voluntary);

b.    Tax Tracking Type is set to None;

c.    Taxes have no ticks;

d.    Not based on Quantity;

e.    Paid on Gross Pay;

f.     Is not an annual limit;

    1. All relevant Income items are included for calculating Super.
  1. Deductions can be pre-tax, post-tax or part of a salary package (non-super salary sacrifice).  Users should check with their accountant or the ATO for direction into which category their deduction falls:
    1. Pre-tax deductions require a Tax Tracking Type of Gross Payments and Taxes checked.  These settings will reduce earnings for calculation of Super and PAYG;
    2. Post-Tax deductions require a Tax Tracking Type of Deductions and Taxes unchecked.  These settings will not reduce earnings for calculation of Super and PAYG;
    3. Salary Packaging will require special treatment to reduce PAYG paid but have Super calculated on normal earnings.  Click here for details. 
  2. Allowances and Additions can be taxable or tax-free.  Users should check with their accountant or the ATO for direction into which category their allowance or addition falls:
    1. Tax-free allowances and additions require a Tax Tracking Type of Allowance and Taxes unchecked.  These settings will not impact on earnings for calculation of Super and PAYG;
    2. Taxable allowances and additions require a Tax Tracking Type of Gross Payments and Taxes.  These settings will increase earnings for calculation of PAYG.  If Super is to be paid on the Allowance or addition, that item must be ticked for inclusion in the Super payroll item setup.

 

Where your setup information is not correct you will need to correct it.  Then you will need to:

  • delete these items from the employee’s Payroll and Compensation Information, and reinput them;
  • open the effected pays, delete the item and reinput it.

Your super should calculate correctly. 

 

Where you still need to alter the Super amount that QuickBooks calculates and this amount is not to report to RESC on the payment summary:

  1. Before processing the pay, click on Edit > Preferences > Payroll & Employees > company Preferences and untick the box Calculate RESC differences for SA and/or CA items; click OK
  2. Prepare the pay and overwrite the Super amount.  This amount will not be reported.
  3. When the pay has been processed go back and tick the box Calculate RESC differences for SA and/or CA items in Preferences. 

 

We strongly recommend that you have the box Calculate RESC differences for SA and/or CA items in Preferences ticked to ensure you do not understate amounts for reporting purposes.  

 

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