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Add/update a payroll tax rate

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Adding and updating your payroll tax rates

Payroll tax is essential in your platform as it is reflected in your financial reports, such as the Advanced Payroll Activity Report (APAR) and the Payroll Tax Report. These reports provide an estimate of your payroll tax liability, enabling you to set aside the necessary funds for when you need to make external payments.

Payroll tax rates also help in creating rates books that can be customised for different Operations within your platform. This is particularly beneficial when dealing with both tax-exempt and standard organisations that are liable for payroll taxation.

In this article, we will go through:

  • Adding a new Payroll Tax rate
  • How to update an existing Payroll Tax rate
  • Getting an estimate of your Payroll Tax using the Payroll Tax Report

  Refer here if you are looking for articles on managing tax, such as editing PAYG tax on a payslip or updating the Payroll Tax State for an operation.

Add a payroll tax rate

To assist with accurate financial management, it's essential to set up Payroll Tax rates in your platform. These rates directly affect your reporting, allowing you to estimate your Payroll Tax for your Operations by using the APAR. 

  Please note: The APAR provides an estimate only and does not account for other factors, such as thresholds. 

Payroll tax rates also allow the creation of rate books within Operations in the platform. This is especially useful when working with both tax-exempt and standard organisations subject to payroll taxation. By establishing separate rate books, your Operations can effectively handle different tax obligations, ensuring compliance and accuracy in payroll reporting. 

  Hot tip: All states' Payroll Tax rates are added to your platform by default. However, a new Payroll Tax rate can be added to your platform at any time. 
 

To add a new Payroll Tax Rate:

  1. Navigate to Payroll Settings > Payroll Tax, then select 'Add Payroll Tax Rate'.

    Add new payroll tax.png
  2. Enter the following details:
    • State - The relevant state for which the Payroll Tax rate is applicable.
    • Rate (%) - The Payroll Tax rate percentage amount.
    • Custom Label - The option to rename the Payroll Tax rate to give it a custom name.
    • Update retrospective data - The option to update retrospective data with the new Payroll Tax rate.
    • Effective from - The date on which the Payroll Tax rate takes effect.
    • Default rate for this date? - Whether this will remain the default payroll tax rate for this state going forward. 
  3. Select Save to save your Payroll Tax rate.

    Add payroll tax page.png
Update an existing payroll tax rate

As you prepare for the new financial year, it is essential to review and update your payroll tax rates by adjusting the relevant state payroll rates and/or thresholds as necessary, starting from the first pay period of the financial year.

  Please note: This update is not performed automatically in your platform.

For more information on Payroll tax rates, please see your relevant state below:


To update an existing Payroll Tax rate:

  1. Navigate to Payroll Settings > Payroll Tax, then select the edit icon (or delete icon to delete).

    Edit and delete icons.png
  2. Update the Payroll Tax rate amount and any additional details.
  3. Select Save to save your changes.

    Edit payroll tax page.png
Payroll tax report

The Payroll Tax Report is a handy tool that gives you a quick estimate of your payroll tax liabilities after payroll processing. It's pretty useful for seeing the total taxable amounts and payroll tax totals in each state.

Checking this report regularly will let you set aside funds to pay your payroll tax externally to foundU.


To generate the report:

  1. From the quick menu, navigate to Reports > Financial > Payroll Tax. 
  2. Set the Duration for this report, or select 'Custom Date Range' to set a specific date span by adding a start and end date.
  3. Additionally, you can use the filters to narrow down your search for specific Office Codes, Employees or  Operations.  Leave blank to see all data.

      Please note: Unlike other reports that split data by Employee, Operations, or Office Codes as separate lines, this report keeps the same line items when you filter. Only the totals change. 
  4. To further break down your data, select from the relevant display options by ticking the checkboxes:
    • Cash Basis - This will compile the data by payment date instead of period end date. Refer to this article for more information about the Cash Basis and reporting. 
    • Show Breakdown of Items - This will separate the report into Payroll Taxable and Non-Payroll Taxable line items for each Payroll Tax State. 
    • Hide Total Column in Export - This option excludes column totals when exporting.
  5. To generate this report, select Sumit. Additionally, if you require a hard copy, you can export the report as a CSV, PDF, or print it.      

     

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