Tag: Payroll year end

Preparing and processing your Payroll Year End only takes eight clear steps. By following them carefully, you can complete the year-end process with confidence and roll smoothly into the new financial year.

COVID-19 has turned 2020 into an exceptionally challenging year. From a payroll perspective, the introduction of JobKeeper, salary reductions, and altered employment arrangements have added significant complexity. For many payroll professionals, Payroll Year End may not have been top of mind—but even small oversights can lead to serious compliance issues.

This guide walks you through how to prepare and process Payroll Year End accurately in SapphireOne.

Review balances and settings

Before processing your final pay run, review all closing balances and payroll settings. Pay particular attention to allowance configurations, especially if any were added or modified during the 2019/20 financial year. This is also an ideal time to review each employee’s payroll details to ensure records are complete and accurate.

If you are claiming JobKeeper and are unsure whether your setup complies with current ATO requirements, we recommend reviewing the JobKeeper step-by-step guide before proceeding.

Reconcile posted pay runs

Payroll Year End is an important checkpoint to confirm that all posted pay runs for 2019/20 have been reconciled correctly. Review your standard payroll checklists and reports to ensure consistency and accuracy.

At a minimum, we recommend verifying:

• General Ledger Audit
• Transactions Audit
• Trial Balance

This step helps identify discrepancies before finalisation, when corrections are no longer possible.

Run the final pay run

Process your last pay run of the financial year as normal, based on your usual payroll cycle (weekly, fortnightly, or monthly). Ensure all payroll entries are complete and reviewed before proceeding.

Finalise your STP declaration

Every pay run requires submission of an STP report, which SapphireOne handles automatically. However, at Payroll Year End, the ATO requires an STP Finalisation Declaration confirming that all payroll information for the financial year is complete and final.

STP finalisation due dates are:

• Employers with 20 or more employees: 14 July
• Employers with 19 or fewer employees: 31 July

To submit the finalisation in SapphireOne:

• Go to: Payroll/HR > History > Pay Run Log / STP
• Click STP Submit
• In the pop-up window:
  • Tick Final Pay of the financial year
  • Confirm and tick the three declarations below

Important note:
The option to re-submit an STP report using “This is an Amendment” applies only to category changes in allowance settings (Payment Summary / STP Position). It is not intended for correcting payroll figures after reversing a pay run.

Run end of month for payroll

Before running Payroll Year End, you must complete End of Month processing for the final payroll month.

Key points to remember:

• Your final pay run must be in period 12
• Payroll Year End moves payroll into period 13
• Do not process pay runs in period 13

Important reminders:

• If you start a new pay run in period 12, do not process it in period 13
• Run Payroll Year End first, then process the pay run in period 1
• Do not post payroll transactions after Payroll Year End has been processed

Payroll periods operate independently from General Ledger periods, so always verify payroll periods carefully.

Once Month End is run and payroll rolls into period 13, you cannot reverse the process. Review all figures thoroughly before proceeding.

Post payroll year end

Once you have confirmed that payroll is correctly sitting in period 13, you can post Payroll Year End.

• Go to: Management > Management > End of Year Payroll

This action finalises payroll for the financial year.

Update periods and taxes

After posting Payroll Year End, update payroll periods and tax settings for the new year.

• Go to: Utilities > Controls > Company
• Open the Periods and Taxes page
• Select Payroll
• Manually update the Finish Date for Period 1 to the new payroll year
• Use Auto Fill (Increment by Month) to update remaining periods automatically

Import tax scales