Setting up a deduction

https://help.myob.com/wiki/x/jJ3MAQ

Close

How satisfied are you with our online help?*

Just these help pages, not phone support or the product itself

0

1

2

3

4

5

Very dissatisfied

Very satisfied

Why did you give this rating?

It's hard to find information

Instructions are hard to follow

Content isn't detailed enough

It doesn't fix my software problems

Anything else you want to tell us about the help?

Deductions are amounts withheld from employee pays (other than taxes). These deductions are then forwarded on to an authority or other organisation. Union fees or child support payments are typical examples.

If the same deduction applies to multiple employees, set it up once and assign it to the employees. Or set up multiple deductions to suit your business. It's up to you.

Before or after tax deductions

If you're not sure whether a deduction is pre- or post-tax, check with your accounting advisor or the ATO/IRD.

Here's how to do it:

To create a deduction pay item

Go to the Payroll menu and choose Pay items. The Pay items page appears.
Click Create deduction. The Create new deduction window appears.
(Australian example shown)

Select the deduction Type.

Country	Type	Description
Australia	Standard deduction	This is for any deduction which isn't a superannuation deduction.
	Super salary sacrifice	This is for employee paid superannuation contributions which they're sacrificing from their gross (before tax) salary. Selecting this type of deduction will lock the Tax field to Before tax.
	Super personal contrib'n	This is for employee paid superannuation contributions which they're paying from their net (after tax) salary. Selecting this type of deduction will lock the Tax field to After tax.
New Zealand	Standard deduction	This is for any deduction which isn't a child support or court fines deduction.
	Child support	If you are required to make child support deductions for an employee, you will be notified by the IRD of the amount to deduct. Employees who pay child support are entitled to keep 60% of their net (after-tax) earnings. If a child support deduction will leave the employee with less than 60% of their net pay, MYOB Essentials will automatically adjust the child support deduction to comply with the protected net earnings rule.
	Court fines	If the Ministry of Justice notifies you by letter to deduct money from an employee's pay and pay it to them, you need to set up a court fines deduction. Employees who are required to pay court fines are entitled to keep 60% of their net (after-tax) earnings. If a court fines deduction will leave the employee with less than 60% of their net pay, MYOB Essentials will automatically adjust the court fines deduction to comply with the protected net earnings rule.

Want to add an SLCIR deduction? (NZ only)

You can enter compulsory extra deductions (SLCIR deductions) from the Tax tab in the employee profile.

Enter the deduction Name, such as "Union fees".
If you'd like a different, more personalised, name to show on payslips for this deduction, enter a Name for payslip, such as "Union fees - Steven".
Enter the deduction Amount.
In the Tax field, choose whether the deduction is Before tax or After tax. If unsure, check with your accounting advisor or the ATO/IRD.
(Australia only) Select the applicable ATO reporting category for Single Touch Payroll. If unsure, check with your accounting advisor or the ATO. Learn more about ATO reporting categories for Single Touch Payroll.
Click Save.
Repeat these steps to create more deductions.

What next?

To ensure a deduction is included in an employee's pay, you'll need to assign it to the employee.

Related topics

Set up Single Touch Payroll reporting

ATO reporting categories for Single Touch Payroll

Paying your employees

Child pages

To create a deduction pay item

What next?

Was this information helpful?

Why not?

How would you improve this page?

Thanks! Anything you'd like to add?

Get started

Sales

Purchases

Banking

Payroll

Work with others

End-of-period

Reporting

Customise

Subscription

Advisors

Tips & tricks