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Reconciling your end of financial year (EOFY) in Reckon Payroll - Web

This article explains how to reconcile your end of financial year (EOFY) in Reckon Payroll

Overview

This EOFY in Reckon Payroll brings some changes with the introduction of Single Touch Payroll (STP) Phase 2 reporting. With the transition complete, it's time to prepare your payroll data for STP finalisation.

If you transitioned to STP Phase 2 mid year, you would have initially reported a single gross amount which was made up of several different payment types, then once transitioning to STP Phase 2, many of these payment types were reported separately.

The ATO does not require you to break down the gross amount previously reported through STP Phase 1 into the disaggregated components of STP Phase 2. Your STP reporting will be a blend of both STP Phase 1 and STP Phase 2.

Accessing reports

To reconcile EOFY, you'll need to look at your Payroll summary report and your EOFY report.

Payroll summary report

The Payroll summary report displays all payroll transactions entered in a pay run. This includes all pay items regardless of whether they have been sent to the ATO via STP reporting.

  1. Go to Reports > Payroll summary
  2. Change the Report period to the current financial year 01/07/2023 to 30/06/2024
  3. Select Print if required
The Payroll summary report only shows values entered in a pay run, therefore any values entered in the Initial YTD screen for an employee will not be displayed.
EOFY report

The EOFY report displays all values from both pay runs and any initial YTD balances that will be reported to the ATO as part of your EOFY finalisation process.

  1. Go to Compliance > EOFY
  2. Ensure you have selected 2023-24 and select to Create 2023-24 report
  3. Select all employees or if you have finalised employees previously, select the relevant employees
  4. Select Create report. A modal window will open with the EOFY values displayed.
  5. Select Print and ensure the Layout is Landscape

Reconciling the reports

When reconciling the reports, you may notice some variances in the totals. These may be the result of some key differences in the reports:

  • The EOFY report excludes Reimbursements, Company contributions, and Deductions that have the deduction type as Other (and Deduct from gross before calculating withholding is not checked). This is because the ATO does not require all pay items to be reported.
  • The EOFY report breaks down the gross amount, while the Payroll Summary report does not. To reconcile the gross value, you will need to sum the Gross Pay, Leave, Overtime, Bonus & Commissions, Directors Fees, Lump Sum, and EFT from the EOFY report.
  • The Payroll Summary report does not show initial YTD values or FBT. To find these values, go to Edit details in the employee profile to access the Initial YTD screen.

Using an example to explain the reconciliation process

In this example book there are 6 employees, each with different payment types to show how you can reconcile the EOFY report to the Payroll Summary report.

Looking at the EOFY report page, the Report summary displays the totals. You can use these totals to reconcile against the totals on the Payroll Summary report.

The totals may vary dependant upon what type of pay item has been used throughout the pay run, or entered as initial year to date values.

Let's look at the variances.

~ Gross earnings do not match

~ Tax free allowances & reimbursements do not have any value on the EOFY report

~ Post tax deduction is not displaying on the EOFY report

~ Company contributions do not have any value on the EOFY report

You now need to check the individual employees to determine if the variances are expected.

Values appearing on payroll summary but not EOFY report

Employee Tasha WILLIAMS has been paid a Company contribution within the financial year. As this is a post tax allowance, the ATO do not require this data, therefore it will not appear on the EOFY report.

Employee Dana FAIRBANKS has been paid a Reimbursement within the financial year. As this is a post tax allowance, the ATO do not require this data, therefore it will not appear on the EOFY report.

Employee Max SWEENEY has had a deduction within the financial year. As this is a post tax deduction, the ATO do not require this data, therefore it will not appear on the EOFY report.

Gross earnings do not match

Employee Shane McCUTCHEON, has been paid Overtime and Leave within the financial year. These values are disaggregated on the EOFY report as this is what is expected by the ATO, therefore when viewing the EOFY report I need to add the Gross pay, Leave and Overtime to reconcile against the Earnings & leave on the Payroll summary report.

Employee Bette PORTER, has had initial year to date values entered within the financial year. As these values do not appear on the Payroll summary report, you need to access their employee profile to view the data entered.

Sending your EOFY data to the ATO

Once you are content with the values on your EOFY report, you can now send them to the ATO.

You need to make an EOFY finalisation declaration by the 14th of July.
  1. Go to Compliance > EOFY
  2. Ensure you have selected 2023-24 and select to Create 2023-24 report
  3. Select all employees or if you have finalised employees previously, select the relevant employees
  4. Select Create report. A modal window will open with the EOFY values displayed.
  5. Select Continue to declaration
  6. Enter the authorised name and select the declaration tick box
  7. Select Submit to ATO
  8. Your EOFY report has been successfully submitted and is now being processed by the ATO. You can check the STP section to follow up on the status of your submission.
If you are seeing the warning Please complete Register software ID, the Continue to declaration button will not be enabled. Select the link in the warning message and confirm you have completed the steps in the Software ID page.

What to tell your employees

You are no longer required to provide employees with a payment summary for the information you’ve reported and finalised through STP.

You can tell your employees that they:

  • can access their year-to-date and end-of-year income statement (previously called the payment summary) online through myGov (they will need to set up a myGov account) or talk to their registered tax agent.
  • need to wait until their income statement is 'tax ready' before lodging their tax return.
  • need to check their personal details and if necessary, update with both you and the ATO (incorrect personal details may prevent them from seeing their STP information).

Need more help?

Ask the Reckon Community at: https://community.reckon.com/categories/reckonpayroll

Or Log a Support Ticket: https://www.reckon.com/au/support/

How did we do?

Setting default pay items and amounts for employees in Reckon Payroll - web

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