Reporting wages on the Activity Statement¶

When you have staff, part of your Activity Statement is a summary of the wages you paid and the tax you held back. The wages go in one box on the form. On the Activity Statement, that box is labelled W1.

W1 is where you report the total wages you paid staff for the period, before any tax was taken out. This lesson explains what goes at W1 and how it usually gets there.

In one line

W1 on your Activity Statement is the total gross (before-tax) wages you paid staff — for employers using Single Touch Payroll, the ATO generally pre-fills it.

Why this matters¶

W1 tells the Australian Taxation Office (ATO) how much you paid your staff for the period. If it is wrong, your Activity Statement does not match what you actually paid. Knowing what belongs at W1 — and checking the figure before you lodge — keeps your reporting accurate and saves you fixing it later.

What you will learn¶

What the W1 label on the Activity Statement is
How Single Touch Payroll pre-fills W1 for employers
Why you should check the pre-filled figure against your records

Understanding the concept¶

W1 is a gross total. The ATO explains that W1 is the total gross payments you made that you usually have to withhold tax from — things like salary, wages, allowances and leave loading paid to employees. "Gross" means before tax is taken out, so W1 is the full amount your staff earned, not what landed in their bank accounts.

Because it is a before-tax figure, W1 is a different, larger number than the tax you withheld. The tax you held back is reported separately (at label W2).

Single Touch Payroll usually fills it in. Most employers now report each pay to the ATO through Single Touch Payroll (STP) — the system that sends the ATO your payroll details every time you pay staff. Because the ATO already has that information, it generally pre-fills your W1 figure on the Activity Statement from your payroll reports. You do not have to add it up by hand.

Always check the pre-filled figure. Pre-fill is a convenience, not a guarantee. The ATO expects you to check the figure it has entered against your own payroll records before you lodge. If the two do not match — for example, because a pay run was missed or reported late — the figure may need attention before you send the statement.

For accountants & bookkeepers

The ATO makes W1 (and W2) pre-fill available in its online services for monthly and quarterly PAYG withholders using data reported through STP. Pre-fill reflects what has been reported by the pre-fill cut-off, so a late or amended pay run report can leave the pre-filled figure out of step with the books. Even payments where no tax was withheld — for example, an employee under the tax-free threshold — still belong in the gross total at W1. Reconcile W1 to payroll before lodging.

Example¶

Priya employs Jordan and Sam at her cafe and reports every pay through Single Touch Payroll. Over the quarter she pays them a combined gross wage of $40,000.

When Priya opens her Activity Statement, W1 is already filled in with $40,000, pulled from her payroll reports. She checks it against her own payroll summary for the quarter. The numbers match, so she is confident W1 is right and moves on.

One quarter, a pay run was reported a day late and the pre-filled W1 looks low. Because Priya checked it against her records, she spots the gap before lodging instead of reporting the wrong figure.

Common mistakes¶

Putting a net (after-tax) figure at W1 — W1 is the gross, before-tax total.
Assuming the pre-filled figure is always correct and lodging without checking.
Leaving out payments where no tax was withheld — they still count in the W1 gross.
Confusing W1 (gross wages) with W2 (the tax withheld), which is a separate box.

How this works in myaccountant¶

In the app — when you prepare your Activity Statement, myaccountant pre-fills the gross wages at W1 from your pay runs, so the figure comes straight from your payroll. You can compare it against your payroll records before you lodge.

Key points¶

W1 on the Activity Statement is the total gross (before-tax) wages you paid staff.
W1 covers payments you usually withhold tax from, even if no tax was withheld on some.
For employers using Single Touch Payroll, the ATO generally pre-fills W1.
Pre-fill comes from your payroll reports, so you do not add it up by hand.
Always check the pre-filled figure against your own records before you lodge.
W1 (gross wages) is separate from W2 (the tax you withheld).

Learn next¶

General information only — not tax, super or financial advice.

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