Providing year end summaries to your team this year will be a touch different than in the past - there's this ol thang we know as Single Touch Payroll (STP). Lets walk through how to finalise in Xero.
With a full year of STP now behind us now is the time to (w)rap it.
Once you've successfully finalised STP, your employees can log into their MyGov accounts and view their information. No need to send them any documents; these being the documents formally know as PAYG Summaries or Group Certificates.
Xero has some great resources around finalising STP, and as always we're happy to assist.
At a high-level, below are the steps you need to complete:
- To reduce file errors, have a full review of your organisation, payroll and employee details; particularly if you have a new Xero file or new employees. Make sure names, email addresses and other details are accurate.
- Run relevant reports with Xero and ensure these reconcile back to the relevant expense and liability accounts. The report will include the Payroll Activity Summary and General Ledger Report.
- Compare totals in these report to expense accounts such as wages, superannuation and allowance. Ensure the balances of liability accounts such as wages payable, superannuation payable and PAYG are accurate.
- Log in to your ATO Portal and compare the totals in the above reports to those in the STP Report (Business > STP Reporting> and those included at W1 and W2 on your lodged Activity Statements.
- Within Xero, under the Payroll menu, select Single Touch Payroll.
- Click on the Finalisation tab and ensure all employees appear on the list. Review each employee for accuracy. See link below should any adjustment be required.
- Select employees to finalise and export the data for record-keeping purposes.
- Click Finalise and submit to ATO.
- Read the authorisation to file declaration. Select the checkbox to accept and authorise the file, then click Submit to ATO.
- Check the Status column in the finalisation screen to confirm finalised employees.
See below checklist link should any of your employees be subject to Reportable Fringe Benefits Amounts (RFBA).
Take particular note of where JobKeeper Top Up Payments appear on each of your employee's payment summaries. These payments should appear under Total Allowances; this being the Top Up amount only and not the full JobKeeper amount.
Some extra resources from Xero
EOFY PAYROLL CHECKLIST - https://xero.app.box.com/v/Payroll-EOFY-Checklist
PROCESS END OF YEAR PAYROLL WITH STP (36 MIN) - https://central.xero.com/s/course?courseId=a473m000000A1LIAA0
Good luck, have fun & may the force be with you