Changes to Payroll Reporting
Recent changes in payroll reporting by Australian Government legislation has meant that salary sacrifice decisions now have to be recorded in more detail by employers, and employers need to supply information on the salary sacrifice arrangements to the Australian Taxation Office (ATO). The reason for these changes is that employees have been able to notionally reduce their income due to salary sacrifice arrangements. This has made the taxpayer eligible for some other government programs, which they may not have been eligible for, other than for the benefit from the salary sacrifice arrangement. The most significant salary sacrifice item is superannuation contributions.
The concept of salary sacrifice is still legitimate and acceptable, however the flow on effect that, in the past, has enabled taxpayers to gain other government benefits, has been changed to ensure government monies are allocated where the government interprets the greatest need. The government's view is that, if a taxpayer can afford to sacrifice a significant amount of his or her income into superannuation, then perhaps that taxpayer may not be eligible for other government benefits. For this reason all payroll reporting will need to include new features effective from 1st July 2009. If you are generating your payroll on your computer then your software provider will have to develop upgrades to ensure that you accurately record additional information from 1st July 2009.
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To contact us for more information on this topic, please call (03) 9802 2533 or click here.
Recent changes in payroll reporting by Australian Government legislation has meant that salary sacrifice decisions now have to be recorded in more detail by employers, and employers need to supply information on the salary sacrifice arrangements to the Australian Taxation Office (ATO). The reason for these changes is that employees have been able to notionally reduce their income due to salary sacrifice arrangements. This has made the taxpayer eligible for some other government programs, which they may not have been eligible for, other than for the benefit from the salary sacrifice arrangement. The most significant salary sacrifice item is superannuation contributions.
The concept of salary sacrifice is still legitimate and acceptable, however the flow on effect that, in the past, has enabled taxpayers to gain other government benefits, has been changed to ensure government monies are allocated where the government interprets the greatest need. The government's view is that, if a taxpayer can afford to sacrifice a significant amount of his or her income into superannuation, then perhaps that taxpayer may not be eligible for other government benefits. For this reason all payroll reporting will need to include new features effective from 1st July 2009. If you are generating your payroll on your computer then your software provider will have to develop upgrades to ensure that you accurately record additional information from 1st July 2009.
To return to the original newsletter, please click here.
To return to the Rogerson Kenny homepage, please click here.
To contact us for more information on this topic, please call (03) 9802 2533 or click here.
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