How Do I?

How do I deduct extra HECS amounts from an employee?
For employees marked as owing HECS Pay2k will deduct the relevant amount of HECS from their salary, based on the amount the employee is earning.

An employee may want extra HECS deducted because they feel their HECS liability will be greater at the end of the year than the standard amount that is being calculated for their HECS payment.

For example:

An employee's HECS liability at the end of the tax year may be greater than the amount of HECS that is deducted in the case where the employee works several part time jobs. In some of the jobs the amount earned is below the threshold for HECS to be deducted. However the employee's combined income from the various jobs will give them a larger HECS liability than the amount that has been deducted. This would result in them receiving a bill from the ATO for the additional HECS amount at the end of the tax year.

Rather than receiving a bill for additional HECS repayments, the employee may ask for additional amounts to be taken out of their pay. To do this the employee needs to complete a 'Withholding Declaration Upwards Variation' form to authorise the employer to deduct an additional amount of tax from their pay. The Withholding Declaration Upwards Variation form requires that a set amount be specified for the additional deduction.

To deduct this extra amount you will need to set up a Transaction Code in Pay2k.

	Go to MAINTENANCE>TRANSACTION CODES
	ADD a Transaction Code to record the Additional HECS Deductions. Choose a Code that is easily identified and write a Description for it that lets you know what the Transaction is for.
	SAVE
	Select TAX ADJUSTMENT as the Category for your new Transaction Code
	Set the Factor for your new Transaction Code as 1. This will enable the transaction to be used for multiple employees if necessary.
	SAVE
	Go into VIEW mode and then into EDIT mode
	Leave the TRANSFER TO GL BY DEPARTMENT field un-ticked
	In the DO NOT TRANSFER TO GL BY DEPARTMENT area enter the appropriate GL Code for the Debit Transaction to go to and the appropriate GL Code for the Credit Transaction to go to
	Go to MAINTENANCE>AUTOPAY
	Highlight the employee that wishes to make extra HECS repayments
	Click on EDIT
	ADD a transaction line for the employee and select the ADDITIONAL HECS transaction item
	In the HOURS AMOUNT field (for the ADDITIONAL HECS line) enter the dollar figure the employee has requested be deducted from their pay each pay period
	SAVE

Any time the Current Pay is run, this transaction will be included for the employee and the Additional HECS amount will be deducted from their pay.

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For more information, please contact:

Heather McKay
Human Edge Software
Phone: 1300 301 931
Fax: +61 3 9690 2802
Email: pay2k@humanedge.biz

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