Employers will need to categorise the payments made to an employee following an ATO term called “Income Stream Type” when they submit their STP report to the ATO.
To Assign the Income Stream Type to the employees, please follow the below process.
Step 1 - Click on "Employees" from the main menu
Step 2 - Select the employee from all employee list
Step 3 - Click on "Taxes" Under Employees
Step 4 - Scroll Down to "Tax Details" and select the "Income Stream Type" that applies to the employees and save the details.
Note
Select the "Country of Origin" if you choose Work Holiday Maker and Foreign Employment as an Income Stream Type and save the details
Add the Contractor's ABN number if you choose "Voluntary Agreement" as an Income Type and save the details
Below is the video for your reference
Following are the descriptions for each income stream type. Select the appropriate type (and country code, if required) against an employee:
Salary and Wages – This is the most common income type and was formerly known as individual non-business (INB). This is the assessable income paid to employees for work performed in Australia. This includes income paid to Pacific Labour Scheme workers, company directors, officeholders, religious practitioners and death beneficiaries.
There is no requirement to assign a country code to this income type.
This income type is applicable to Residents and Non-residents
Closely Held Payees – An employee who is directly related to the entity, from which they receive payments, such as family members of a family business; directors or shareholders of a company; beneficiaries of a trust.
There is no requirement to assign a country code to this income type.
This income type is applicable to Residents
Work Holiday Makers - This applies to temporary visitors to Australia who holds a Working Holiday visa or Work and holiday visa.
Country Code is mandatory for this income type
This income type is applicable to Working Holidaymakers
Seasonal Worker Programme – Applies to regional programmes for government-approved employers, administered by the Department of Employment, Skills, Small and Family Business. An employee is identified as a seasonal worker when the 'Seasonal worker' (and business is an approved employer of the SWP)' checkbox is selected from the 'Other Criteria' section. There is no requirement to assign a country code to this income type.
This income type is applicable to Residents.
FEI (Foreign Employment) – The income paid to payees, who are Australian tax residents, that is subject to tax in another country, for work performed in that country, if the qualification period is met.
Country Code is mandatory for this income type
This income type is applicable to Residents
Voluntary Agreement - A written agreement between a payer and a contractor payee to bring work payments into the PAYG system. The payer does not have to withhold amounts for payments they make to contractors. However, the payer and a contract worker (payee) can enter into a voluntary agreement to withhold an amount of tax from each payment they make to the contractor applied to contractors paid under a Voluntary agreement.
ABN Number is mandatory for this income type.
This income type is applicable to Residents and Non-Residents
Labour-Hire – Applies to payments by a business that arranges for persons to perform work or services, or performances, directly for clients of the entity. Income for contractors only does not include employees but may include those with a voluntary agreement.
This income type is applicable to Residents and Non-Residents
If you have any feedback or questions, please email us at support@payroo.com.au