12 End of Year Process

Finalisation, STP and PAYG

An employer is required to make a declaration to the ATO that they have provided all the information for each employee for a financial year.  This can be done inside or outside of STP.  

Within STP, finalisation involves:

• Setting employees to final
• Submitting a Final Event to the ATO for that employee (ie reporting the employee as final)
  • by provision of a finalisation indicator for an employee to mark the event as the employees final STP Event

Final Events can be:

• either a Pay Event or an Update Event
• Wholly a Final Event, ie every employee in the event is finalised, or
• Contain a sub set of employees who are being finalised by that event
• submitted during or after the Financial Year
  • The ATO has rules about when Finalisation is due post the end of the Financial Year, users should refer to ATO STP documentation for these dates

Employees are finalised for STP by setting the Final Event Indicator field: Final STP Event for Financial Year, which is in Payroll > Payroll Employee Maintenance > Tax tab

Employees are finalised outside of STP by sending the ATO the employees PAYG summary for the Financial Year, and recording this by ticking ATO sent copy of PAYG Summary.

Payroll > PAYG Summaries > PAYG Selection will bulk process this.

The last reported value of Final STP Event for Financial Year, the date and Submission Number of that report is shown directly below the field on the Payroll Employee Maintenance Tax tab.

Finalisation Rules

1. Employees are finalised if either of the following are ticked
   1. Final STP Event for Financial Year
      • and submitted in an STP Event
   2. ATO sent copy of PAYG Summary
      • copy of PAYG Summary sent to ATO
2. The Final STP Event for Financial Year and ATO sent copy of PAYG Summary tick boxes are mutually exclusive:
   1. If an Employee* has Final STP Event for Financial Year on, then ATO sent copy of PAYG Summary cannot be set to on.
   2. If an Employee* has ATO sent copy of PAYG Summary on, then Final STP Event for Financial Year cannot be set to on.
   3. The business reason for the mutual exclusiveness of these fields is that the provision of a PAYG Summary to the ATO is an alternate method of finalising an employee to that of finalising them within STP.  The ATO requires only one form of finalisation.
3. PAYG Amended field being  ticked will prevent Final STP Event for Financial Year from being set also.
   1. If PAYG Amended field is ticked, the employee cannot be finalised via STP.
4. PAYG Summary Printed field does not effect finalisation.

*   Employee in this case is either active or terminated.

Final Event Indicator

When 'Final STP Event for Financial Year is ticked for an employee, any STP Event generated for that employee is tagged with Final Event Indicator as true.

Individual Finalisation

Individual finalisations are set against the employee in Payroll > Payroll Employee Maintenance > Tax tab - See Finalisation Rules above.

Bulk Finalisation

A process to bulk set finalise event indicator for employees exists:

Payroll > Bulk Set Final Event Indicator

The Bulk Set Finalisation follows the same rules as for individual finalisation:

Finalisation Rules

Report:  Final Report Indicator Summary

Reversing Finalisation

To reverse finalisation (eg if a terminated employee is re-hired) un-tick the 'Final STP Event for Financial Year' to off, and submit a new STP Event.  This can be the first Pay Event for the re-hire.  The ATO will automatically pick up the reversal.

If the ATO has been submitted an employees PAYG and subsequently, finalisation for the employee needs to be reversed, contact the ATO directly.