Handling BackPay in Payroll Premier

Legacy KB ID: 4481

Question

I have to pay an employee some backpay that includes a period from over 12 months ago.  A component of this pay must be included in the Lump Sum E field of the Payment Summary.  How can this be done in Payroll Premier?

Answer

Backpay is handled in the Sundry tab of the employee’s payroll preparation tab.  There are two backpay options:

Backpay <= 12 months – this item will include payments into Gross Payments and tax to Total Tax Withheld fields of the Payment Summary.

Backpay > 12 months – this item will include payments into Gross Payments and tax to Total Tax Withheld fields, as well as list the amount in the Lump Sum E field of the Payment Summary. 

Backpay for a previous financial year may attract different tax treatment.  See the ATO website for further information.  The current publication is dated June 2008 available at:  https://www.ato.gov.au/content/downloads/BUS00140434n33480508.pdf.  Please check for later updates.

 

 

Detailed Instructions

1.    Start the pay run by clicking on the Pay Run icon

2.    In Pays Summary for All Employees, click on the Employee to receive backpay;

3.    Click on the Sundry tab and select the appropriate backpay option;

4.    Select appropriate Super and Ex Tax treatment;

5.    Complete any other adjustments to this pay for this employee;

 

Note:  if the employee is being terminated, any Lump Sum E payments should be made in the final normal pay.  It is not part of the Termination Wizard. 

 

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