Process a termination (final) pay run in Reckon One

Learn how to process a termination pay within a single pay run in Reckon One, to ensure values are reported correctly to the ATO as part of the STP submission.

Before you start

Before you process a final pay, you will need to have terminated the employee in Reckon One.

Create a final pay run

You will be given the option to create a final pay run straight after terminating an employee in Reckon One, or you can do it later via the employee profile:

1. Go to Payroll, then Employees.
2. Select the employee.
3. Select the Create final pay run in the top right hand corner. A pay run drawer will open.
4. (Optional) You can edit the Pay date or the Pay period.
5. Select Archive employee once the pay run is marked as paid to ensure the employee is set to inactive.
6. Select Create pay run.

Edit pay details

1. Once the final pay run has been created, you'll be on the pay runs screen. Select the employee's name to edit their pay details.
2. If the employee's leave is set to pay on termination, the leave pay item will be calculated and the ATO reporting category displayed.

   

3. Make any adjustments necessary to the termination pay. To adjust the reporting categories for unused leave you may need to edit leave items to and/or add new ones, and adjust the PAYG tax if necessary according to Schedule 7 – Tax table for unused leave payments on termination of employment.

Example of adjusting the reporting categories

I will need to:

• reduce the hours of long service leave that are allocated to Unused leave on termination
• create a new leave item for the long service leave that needs to be reported as part of Lump Sum B
• adjust the tax, because Lump Sum B is taxed at a different rate to Unused leave on termination.

To reduce hours of long service leave allocated to Unused leave on termination:

1. Override the Qty from 45 to 40 for Long service leave .

   

To add a new leave item for the long service leave that needs to be reported as part of Lump Sum B:

1. Select Add Earning in the Earnings section and select Long service leave from the drop-down list.
2. Enter the Quantity as 5
3. Select Edit against the STP Reporting Category: Unused leave on termination and select Lump sum B from the drop down list

   

4. Select Done.
5. Save the changes

To adjust the tax because Lump Sum B is taxed at a different rate to Unused leave on termination

1. As Lump sum B is taxed at a different rate, scroll down to PAYG section and Override the calculated tax value in the Amount field.

   

2. When you're finished editing and adjusting the pay run, select Save.

Mark the pay run as paid and submit to the ATO

Learn how to mark the pay run as paid, view and email payslips and submit the pay run to the ATO.

Read more

• See the ATO's Schedule 7 – Tax table for unused leave payments on termination of employment
  
  

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