Set Up a PAYG Deduction Code: Australia

For PAYG to calculate properly, you must first set up deduction codes specifically for PAYG.

For a more general description of creating deduction and liability codes, see Creating Deduction and Liability Codes.

To set up a PAYG deduction code.
  1. On the PR Deduction/Liabilities form, enter 1 in the Dedn/Liab Code field and enter a description in the Description field.
    Note: The PAYG deduction code must be assigned code number 1.
  2. In the Type section of the form, select the Deduction radio button.
  3. Set the Calculation Category drop-down to F-Federal.
  4. From the Federal Type drop-down, select 1-Withholding.
  5. In the GL Account field, enter the GL account to credit for this deduction code.
  6. From the Method drop-down, select R-Routine.
  7. In the Routine field, enter PAYG Tax or press F4 to select it from a list.
  8. In the Addl Info tab, set up automatic AP updates for the code, making sure to select the Separate AP transaction per Employee check box.
  9. On the Add' Info tab, from the ATO Category drop-down, select Tax Withheld.
  10. Determine the calculation basis for the deduction/liability code, as necessary.
  11. Save the record.
You can now associate employees with this PAYG deduction code.