Prepare your payroll for the new Australian Financial Year FY22
It's that time of year again and as always, KeyPay is committed to taking the stress out of End of Financial Year and making year-end reporting as easy as possible for its customers.
There are a number of notable changes that will impact payroll, coming into effect on July 1 2021, which KeyPay as always will be prepared for. Here’s what you need to know for the new Financial Year:
Superannuation Guarantee (SG) rate
In the new Financial Year, the legislated SG rate will increase from 9.5% to 10%. KeyPay users can rest assured that we will be applying this increase automatically for eligible businesses who have configured these requirements.
Tax rates and income thresholds
The Federal Budget did not result in any changes to tax rates or income thresholds for the 2021-22 financial year. The extension of the low and middle income tax offset is only claimable when individuals lodge their income tax return.
Maximum Superannuation Contribution Base (MCB)
The MCB will increase to $58,920 per quarter. From 1 July 2021, the new MCB amount will be displayed in the employee pay run defaults screen in KeyPay. Prior to that date, the system will continue to show the MCB rate applicable for the 2020-2021 Financial Year.
Genuine redundancy cap
The genuine redundancy cap has increased to $11,341 (base limit) and then $5,672 for each completed year of service;
Employment Termination Payment (ETP) cap
The ETP cap for life benefit termination payments has increased to $225,000.
Study and Training Support Loans (STSL)
STSL updates have been applied for the new financial year due to the annual indexing of the repayment income thresholds.
If your payroll software is cloud based, these changes should apply automatically. If you have desktop software, you may have to download updates. As always, KeyPay users can rest assured that they don’t need to do anything to begin using these new tax tables, and all new rates will automatically apply to any pay run with a date paid on or after 1 July 2021.
The new Financial Year is a great time to re-evaluate existing processes and upgrade your software for the year to come. Try Australia’s leading payroll and workforce management software for free, and change the way you work and pay for FY22.