On the Tax tab, you enter details that allow MYOB Essentials to correctly determine which tax table to use for this employee. This ensures the amount of tax withheld is correct.

Tax file number declaration (Australia)

Before filling in this tab, make sure the employee has completed and returned their Tax file number declaration. If they’re claiming any other variations or exemptions, they need to get the appropriate forms from the ATO, fill them in and give them to you. These forms will contain all the information you need when filling in details on this screen.

To complete this section, simply copy the employee’s answers from the numbered questions on the Tax file number declaration form into the matching numbered fields on this page.

Tax code declaration (New Zealand)

Before filling in this tab, make sure the employee has completed and given you an IR 330 Tax code declaration form. They can download this form from the IRD website.

If they’ve got a special tax code or are required to make student loan repayments, they may also give you a Special tax code or student loan repayment certificate (IR23). These forms will contain all the information you need when filling in the details on this screen.

To complete this section, simply copy the employee’s answers from the numbered questions on the Tax code declaration (IR330) form into the matching numbered fields on this page.

Tax rules for primary and secondary school students (New Zealand)

There are different tax rules for primary and secondary school students. Select this option if the employee is currently a student in primary or secondary school.

School students expected to earn less than $2,340 per year (that is, $45 per week) are not required to complete a Tax code declaration (IR330) form, and you don’t need to withhold PAYE tax from their pay.

Use the pay details you entered on the Employee details tab to determine whether the employee is likely to earn more than $2,340 in the current year.

School students who are expected to earn more than $2,340 in the year are entitled to a tax credit that will reduce the amount of PAYE deducted from each pay.

For more information about tax rules for primary and secondary school students, see the IRD website.

Special tax code or student loan repayment form (New Zealand)

Your employee might give you a Special tax code or student loan repayment (IR 23) certificate, which authorises you to deduct tax at a different rate, or not at all. Copy the information about the deduction rates from the form into the matching fields on this screen.

Note that you must see this certificate before you can change the rate at which PAYE is deducted from your employee’s pay.

Miscellaneous (Australia)

Withholding variations

If the employee is eligible for a withholding variation, they’ll have arranged this previously with the ATO. To claim the variation, they need to give you a Withholding variation declaration form, available from the ATO website. The form needed will depend on the type of variation.

Flood levy exemption

Employees eligible for the flood levy exemption need to fill in and give you the Flood levy exemption declaration form from the ATO website.

Related Topics

• Set up employees
• Task 1: Enter employee personal details
• Task 3: Set up additions and deductions