There are two deadlines associated with PAYG Summaries that are issued by MYOB and Xero.
1. Issue individual PAYG summaries to all employees no later than 14th July 2018.
2. Lodge the EMPDUPE.a01 (electronic file) and Magnetic Media Summary with the ATO no later than 14th August 2018.
Often employers remember to do step 1, but do not realize, or forget about step 2.
What does the ATO do with these lodgements?
They run analytics on the PAYG summaries. The main thing the ATO is looking for is to ensure that the total wages and PAYG withheld per the annual lodgement matches to the grand total of wages and PAYG withheld through the year on the four x Quarterly BAS or the 12x Monthly IAS statements. If there is a discrepancy, the ATO will send the employer a letter, and if needed follow up by phone.
Here is a very common problem that is found by the ATO:
The employer processes payroll for the month and completes the monthly Instalment Activity Statement (IAS). Weeks later, the employer realizes they have made a mistake. They have overpaid an employee. The employer goes back to the payroll entry in MYOB or Xero, deletes the entry and then processes the correct amount. They forget to amend the IAS. When the employer lodges the annual summary it does not match to the sum total of the IAS lodged.
What can employers do to ensure the PAYG summaries lodged are correct?
There are a number of control totals reported by both MYOB and Xero during the PAYG preparation process. These control totals must be matched to the payroll activity summary (MYOB) and payroll by employee (Xero) and also matched to the total of all IAS/BAS Lodged.