STP Phase 2: New Deductions Reporting Categories & Protected Earnings

Deductions: New Reporting Categories

As part of STP Phase 2 Reporting compliance, one of the changes is to the way Child Support is reported to the ATO. Child Support Garnishees and Deductions will be able to be reported (voluntarily) through STP. The benefit of doing this is employers would no longer need to provide separate Child Support Certificates.

The key changes in the platform are:

1. The introduction of 2 new deduction classifications:

• Child Support Deduction
• Child Support Garnishee​

2. Separate salary sacrifice options

Follow these instructions to update your Deduction types.

Protected Earnings

In line with the changes to Deductions is the introduction of Protected Earnings. The main use for a Protected Earnings deduction is for child support payments. The Protected Earnings Amount (PEA) is the part of an employee or contractor’s pay exempt from child support deductions. This means that you don’t deduct all of the employee's pay for child support payments.

Now when you apply a deduction to a specific employee's profile, you will see Protected Earnings as an option. 

Guide on Protected Earnings.