Item 1 - salary, wages, commissions, bonuses etc

This is a calculator-only field provided for the correct calculation of tax on taxable income at special rates.

Select Yes if the taxpayer is a Seasonal Worker under this programme.

Read the on-screen text and select Yes at the 416 or 462 working holiday visa question, so that tax is calculated at 15% on WHM income earned during the 2017-18 tax year.

If your payment summary includes Gross payment type H, print H in the payment type box. Gross payment type H applies to you if you were on a 417 or 462 working holiday visa, and you earned income during the 2017-18 tax year. If this applies to you, then you must complete item A4.

If your working holiday maker has a foreign payment summary with code H, select the code G and include any WHM income and expenses incurred in earning that income during the 2017-18 tax year at item A4. This code will be converted to H for electronic lodgment.

For MYOB Tax to provide a correct calculation of tax payable, if you select Code F (Foreign) at item 1, then you must select Yes or No at the checkbox provided for the Seasonal Workers Programme.

Amounts should only be entered at item 1 if the taxpayer has a Payment Summary from an employer, or has signed a Statutory Declaration that the payment summary is lost or was not received.

At item 1 there are two sets of payment summary fields in the return. If you have more than two payment summaries, enter these in the Excess Payment Summary worksheet (egc).

You should also enter at item 1:

• Allowances, earnings, tips, director's fees, etc, as they are recorded on each Payment Summary and these amounts will integrate to Item 2 label K.

• Employer lump sum amounts A and B, as they are recorded on each Payment Summary and these amounts will integrate to item 3 labels R and H. Key the gross amount for Lump Sum "B" and Tax automatically calculates the 5% assessable amount and integrates it at Item 3 Label H.

If the taxpayer has more than 2 Payment Summaries press [Enter] at the Additional Payment Summaries box and complete a separate PAYG Payment Summary (egc) for each. The sum of these amounts will be shown as a single entry at Label G.

In MYOB Tax, you will also enter Reportable Fringe Benefits and Reportable Superannuation contributions that are notified on the PAYG Payment Summary. These amounts are passed to the Income Test Items IT1 and IT2 respectively.

From 1 July 2017, Reportable fringe benefits are reported separately in accordance with their exemption status under section 57A of the FBTAA 1986. Enter this amount at the correct field as defined on the Payment Summary.

If you received any reportable fringe benefits amounts of $3,773 or more, enter those amounts at the relevant field(s) in the Reportable fringe benefits box. Do not enter amounts that are less than $3,773 as this will affect the calculation of the Adjusted taxable income (ATI) that is used for defining eligibility for some offsets, for example dependency offsets and SAPTO.

Click this link for information on PAYG payment summaries - individual non-business on the ATO website.

Do NOT combine amounts from different payment summaries even if they are received from the same employer. Each Payment Summary's content must be entered as a separate transaction.

Foreign Employment Payment Summaries

If you are entering the details of a Foreign Employment summary, select Code F from the drop down at the gross income label.

If a working holiday maker receives a foreign payment summary while working in Australia and holding a 416 or 462 visa, select Code G from the drop down at the gross income label. Note that Code G will be converted to Code H for electronic lodgment purposes, ensuring that the ATO is alerted to the special income and will calculate tax in accordance with the legislated 15% up to $37,000 tax rate and threshold.

Such amounts must also be included in an information label at item 20 label U Net foreign employment income - payment summary and Tax will transfer any amount with the code F to a special holding dialog at item 20 label U. This dialog also contains a field to enter any applicable work related expense that has been claimed at items D1 to D5. If foreign tax has been paid on this income, there may be an entitlement to a foreign tax credit.

Foreign Income Tax Offset (FITO)

For the correct calculation of FITO, instructional text has been added at item 1 to alert those preparers entering foreign payment summaries and selecting the code F not to enter the foreign tax paid on that income at item 1 but to enter it in the dialog provided behind label U at item 20.

The Income amount is automatically transferred to this dialog; however, you will need to enter the amount of foreign tax in the field provided as shown in the following image:

The Code at Item 1 for the type of Payment Summary is not an ATO field but is required for correct estimate calculations of tax payable/refund due.

See Lost or missing PAYG withholding payment summary on the ATO website for more information.

If you enter amounts for salary or wages, an occupation code, representing the main occupation must be provided. If you are unsure then select the occupation code that represents the highest earnings. The full list of codes recognised by the ATO is provided as an [F10] list. A search function is provided and keying one or more words of the job description in this and clicking the Search button will provide a list of all Occupations containing the words.

When paid by your employer, PPL will be included in gross payments and not listed separately like, bonuses, etc.

PPL will be listed separately only if it comes from the Family Assistance Office (FAO) in which case you will have a PAYG Payment Summary issued by Centrelink. These Centrelink payments must be entered at item 1 as salary and wages and not at item 5 as such payments do not lead to a beneficiary offset.

Payer's ABN and (optional) Name: If an ABN is entered it must pass the ATO algorithm for valid ABNs or WPNs. If an ABN is present, then an occupation code and description must be present. The Payer's name may be provided but this is not mandatory.

Tax Withheld: For each employer (payer), enter the amount of tax withheld from the relevant Payment Summary - Individual, non-business. The amount of tax withheld may not exceed the gross payment.

Gross payment: For each employer (payer), enter the gross payment amount from the relevant Payment Summary - Individual, non-business. If a gross salary amount greater than zero is entered, then an occupation code and description must be present.

Amounts marked 'A' and Amounts marked 'B': The total of amounts entered in these fields are shown at Item 3 Lump Sum Payments.

Lump sum payments that you show at item 3 are amounts paid for unused annual leave or unused long service leave. If you have received such a lump sum payment it will appear at either 'Lump sum A' or 'Lump sum B' on the payment summary or statement you received.

Lump sum A

The amount shown at 'Lump sum A' was paid to you:

• for unused long service leave, or unused annual leave, that accrued after 17 August 1993 if that amount related to a payment that was made in connection with a genuine redundancy payment, an early retirement scheme payment or the invalidity segment of an employment termination payment or a superannuation benefit;

• for unused long service leave that accrued after 15 August 1978 and before 18 August 1993, or

• for unused annual leave that accrued before 18 August 1993.

Lump sum B

The amount at 'Lump sum B' was paid to you for unused long service leave which you accumulated before 16 August 1978.

Type Code

If the amount shown at 'Lump sum A' related to a payment that was made as a genuine redundancy payment, an early retirement scheme payment, or the invalidity segment of an employment termination payment or a superannuation benefit enter R in the Type column. Check with your payer if you are not sure.

Otherwise enter T in the Type column

If the taxpayer has more than 2 Payment Summaries press [Enter] at the Additional Payment Summaries box and complete a separate PAYG Payment Summary (egc) for each. The sum of these amounts will be shown as a single entry at Label G.

When the return is printed as a facsimile, the Excess PAYG Payment Summary entries that exceed the four sets of labels on the pre-printed return are printed on an Additional Information schedule in accordance with ATO instructions. If 'Print details in return' has been selected as a print default for the Client Copy print-out, all entries are printed at Item 1. When the Print details in return has not been selected as the default, the excess entries are printed on a schedule headed 'Excess Payment Summaries'.