The EOFY payroll checklist¶

Closing off the payroll year is a handful of steps done in order. None of them are hard on their own — the trick is not to skip one. This lesson lays them out as a plain checklist you can work through.

Keep this page handy in late June and early July. Later lessons in this module explain each step in more detail.

Why this matters¶

At end of financial year several jobs land at once, and they have a set order. If you finalise before your totals are right, you can still fix it, but the Australian Taxation Office (ATO) says errors are easier to avoid than to correct after the fact. A checklist keeps you from missing a step or doing them out of order.

What you will learn¶

• The main steps to close off the payroll year
• What to do before you finalise your STP data
• What to tell your employees at the end

Understanding the concept¶

Here is the payroll year-end checklist, in order.

1. Process the last pays of the year. Make sure every pay dated on or before 30 June has been run and reported through Single Touch Payroll (STP). STP is the system that sends each employee's pay, tax and super to the ATO each payday. Nothing for the year should be left unpaid or unreported.

2. Check and reconcile your totals. Go through the year's totals — gross wages, the tax you withheld, and super — and make sure they match your own records. "Reconcile" just means checking that two sets of figures agree. The ATO asks you to check that each employee's year-to-date amounts are correct before you finalise.

3. Make sure super is up to date. Check that the super you owe for your employees has been worked out and paid to their funds. Your payroll figures and your super records should tell the same story.

4. Finalise your STP data. Once the totals are right, send the finalisation declaration. This is the message that tells the ATO your year's figures are complete and final for each employee. You finalise for everyone you paid during the year, including people who left and casuals.

5. Let your employees know. After you finalise, each employee's income statement is marked "Tax ready" in myGov (the government's online services). It is good practice to tell your team it is done, so they know they can start their own tax return.

Example¶

A builder with two employees works through the list in early July. First he confirms the last June pay run went through and was reported. Next he checks the year's gross, tax and super totals against his records and finds they agree. He confirms the super for the last quarter has been paid to the funds. Then he sends the finalisation declaration for both employees. Finally he sends a quick message: "Your income statement is now tax ready in myGov."

Common mistakes¶

• Finalising before checking the totals — check first, finalise second.
• Missing the last pay of the year, or a casual's final shift.
• Forgetting to confirm super has actually been paid, not just calculated.
• Not telling employees, so they keep asking when they can do their tax return.

How this works in myaccountant¶

Key points¶

• Process and report every pay dated on or before 30 June.
• Check and reconcile gross wages, tax withheld and super against your records.
• Make sure super owed has been paid to the funds.
• Finalise your STP data for every employee you paid during the year.
• Let employees know their income statement is "Tax ready" in myGov.
• Do the checks before you finalise — errors are easier to avoid than fix.

Learn next¶

• What EOFY means for payroll
• Reconciling payroll before you finalise
• What is STP finalisation?

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