According to the Revised Draft Amendment Bills affecting payroll, Government has proposed as Skills Development Levy Contributions Holiday from the 1st May 2020 until the 31st of August 2020. These Bills are still in a Draft State and changes should not be made to the system before your Tax Practitioner has given you the go ahead to do so.
The Proposed Changes that I refer to above was published on the 1st of May 2020 and can be found here.NOTE: Only make these changes on your system once your Tax Practitioner has advised you to do so.
SDL can be removed for all of your employees in different ways, and each one has their own ‘draw back’ to take into consideration. For the purpose of this guide I will give you two options that will lead to the calculation of code 9150 to become a zero. Only choose one of these options to follow. Whichever option you choose, will zero out the amount on 9150 from the current period going forward. The amount will not be backdated. If you have already processed a week in May including SDL, you can either do a corrective transaction or restore a backup.
Option 1: Remove the Percentage on the transaction
Drawback: Every time you run a legislative release, the percentage will be added back to the system and you will have to go and Zero out the percentage on the transaction again.
Method:
- Click on Setup
- Click on Transactions
- Click on the magnifying glass and enter the code 9150 and press enter
- You will now be in the transaction 9150. On the bottom of the screen, change the Percentage from a 1 to a 0
- Click on Copy to Weekly and Copy to Fortnightly if it is applicable to your company. Alternatively, you can click on the Weekly and/or Fortnightly tab and change the value for the percentage from a 1 to a 0:
- Click on Save.
What to do after the Holiday: You can run a legislative release in the first period in September and the transaction will automatically be updated.
Option 2: Tick SDL Exempt in Company Parameters
Drawback: You will receive a Payroll Run exception and a Statutory August period that you have SDL processed but SDL exempt has been selected – this exception can be ignored if you unchecked SDL for the SDL holiday.
Method:
- Click on Setup
- Click on Company Parameters
- Click on the Statutory tab
- Tick the SDL Exempt Check box
- Press OK.
What to do after the Holiday: You will follow the above steps and untick the SDL Exempt Check box, you will have to re-enter the SDL Reference number.
Our PDF Guide can be found here