Message-ID: <1324775649.15759.1573514097123.JavaMail.csuser@audmzcmscf01.aumeldmz.local> Subject: Exported From Confluence MIME-Version: 1.0 Content-Type: multipart/related; boundary="----=_Part_15758_1008007190.1573514097123" ------=_Part_15758_1008007190.1573514097123 Content-Type: text/html; charset=UTF-8 Content-Transfer-Encoding: quoted-printable Content-Location: file:///C:/exported.html Back pay

# Back pay

An employee might be owed back pay to account for a wage = increase, or to make up for an incorrect pay rate.

Back pay is the difference between:

• how much the employee should have been paid over the back pay period, a= nd
• how much the employee was actually paid.

Once you've worked out the back pay amount, you can include it on&n= bsp;the employee's next pay.

Before proceeding, make sure you've updated the employee's pay details to reflect their updated wage.

OK, let's step you through how to handle back pay.

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1. Work out what the employee should have b= een paid
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### Work out what t= he employee should have been paid

The easiest way to work this out is to review a sample&nb= sp;pay for the employee.

1. Start a new pay run&nb= sp;for the employee.
2. Click the zoom arrow ( ) to review their pay det= ails on the Pay Employee window.
3. Take note of the gross pay and PAYG Withholding values= . Here's our example for a weekly pay which we've also multiplied by 4 to g= et values for a 4 week pay: =
4. If necessary, multiply the values based on the number of week= s of back pay that is due.
5. Cancel the pay without saving.
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2. Work out what the employee was actually = paid
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### Work out what the = employee was actually paid

The Payroll Activity (Detail) report provides this info= rmation.

1. Run the Payroll Activity (Detail) report for the back = pay period (Reports > Index to Reports > Payroll > Employe= es > Activity Detail).
2. Filter the report.
• Select the employee who is owed back pay.
• Specify a date range to capture the back pay period.
3. Take note of the employee's Wages and Tax= es values.
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3. Calculate the back pay
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### Calculate the back pay

To calculate the back pay, subtract what the employee was actually paid = from what they should have been paid.

This example shows the employee should have been paid \$1500 in gross pay= but was actually paid \$1400. This also determines that an additional = \$10 of tax should have been withheld. =20
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4. Pay the back pay
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### Pay the back pay

You can now include the back pay in the employee's next pay.

1. Start a new pay run&nb= sp;for the employee.
2. Click the zoom arrow ( ) to review their pay det= ails on the Pay Employee window.
3. Determine the PAYG Withholding payable:
1. Take note of the PAYG Withholding value show= n in the employee's pay.
2. Add the back pay tax amount calculated above to work out the total tax = payable.
5. Select the Back Pay category and click OK.
6. Enter the gross back pay value against the Back Pay ca= tegory.
7. Change the PAYG Withholding value to the figure you ca= lculated at step 3. Here's our example with \$100 entered against the Back Pay wage category and the PAYG Withholding value adjusted.
8. Record the pay.
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Superannua= tion

By default, the Back Pay wage category is not exempt fr= om superannuation. This means back pay will be included in superannuation c= alculations.

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