Previously in Quickbooks, in order to have salary sacrifice calculate correctly, two payroll items – a Company Contribution Item and a Deduction item – needed to be set up. This has been amended in new Quickbooks versions since 2009/10 to a single payroll item, and now ensures that the process has been simplified immensely.
The example below will demonstrate setting up a salary sacrifice item in Quickbooks that does not exceed the statutory employer contributions, and means the employer is not entitled to stop paying the statutory super amounts.
(PAYG and State Payroll Tax are applicable – check your own state’s State Payroll Tax laws (in Victoria follow this link.)
- Create a new payroll item
- Select Super Contribution
- Name the Item Salary Sacrifice for Super
- Select Salary Sacrifice (SS)
- Since RESC was introduced on July 1st 2010, all items except Statutory Super (or the equivalent item name) will report on the payment summary
- Select the Agency
- Add the employer identifying number
- Enter the liability account Payroll Liabilities:Salary Sacrifice
- Tax tracking type is Gross Payments
- Do not select ‘Based on Quantity’
- Calculate on Gross pay
- Set the default rate as 6%(example rate), with no limit
- Select whichever items will be subject to this contribution
- Click finish
Now add this item to the employee record
- Edit the employee
- Click to the Payroll and Compensation Info tab
- Click the Super Details button
- Underneath the Statutory Super item, select Salary Sacrifice for Super (This should pull through the rate information from the payroll item). Add any other account information as required
- Click OK
- Pay the employee and look at the effects on the earnings and liabilities
To see the amount being taken out of the pay, generate an Employee Earnings Summary report.
- Click Reports > Employees & Payroll > Employee Earnings Summary
- The Employee earnings summary also shows the split between the Statutory Super payments and the additional payments which will reflect on the Payment Summary
To see the Salary Sacrifice liability amount increasing, either do a QuickReport on the liability account, or
generate a Payroll Liability Balances Report.
- Click Reports > Employees & Payroll > Payroll Liability Balances
To see the Salary Sacrifice amount and the Statutory Super amount, generate a Super Report
- Click Reports > Employees & Payroll > Super Report by Employee