Long distance truck drivers, as part of their renumeration are paid an overnight accommodation allowance up to the ATO reasonable rate. Under the STP phase 2 reporting should this be reported as an allowance and therefore appear at W1 on the activity statement? I have seen recently from payroll providers where this to be excluded completely from allowances reported unless it exceeds the ATO reasonable rate.
thanks
Hiya @Michael-d 👋
I'm a bit confused about "overnight accommodation allowance" for long distance truck drivers, as the ATO TD 2023/3 includes these paragraphs that explicitly states:
11. The following reasonable amounts for domestic travel expenses do not apply to employee truck drivers[1], office holders covered by the Remuneration Tribunal[2] or Federal Members of Parliament.[3]
27. All accommodation expenses and incidental expenses (for example, the cost of a shower) incurred by employee truck drivers as part of work-related travel must be substantiated with written evidence (for example, a receipt).
The paragraphs relating to truck drivers are 24-31.
To your second issue, I would be interested to know which "payroll providers" aren't complying with the ATO DSP instructions about which payments to include in the parent period total amounts?
Let me summarise the ATO requirements that were provided to payroll providers to ensure their products complied. All payments included in the pay event are included in the payer total gross payments amount (parent period gross/W1), except for exempt amounts:
That is, for those expense allowances that have ATO measures in place, where the conditions are all met, the PAYGW may be varied to zero. It is still a payment subject to withholding, it is not exempt.
Deanne
Hiya @Michael-d 👋
I'm a bit confused about "overnight accommodation allowance" for long distance truck drivers, as the ATO TD 2023/3 includes these paragraphs that explicitly states:
11. The following reasonable amounts for domestic travel expenses do not apply to employee truck drivers[1], office holders covered by the Remuneration Tribunal[2] or Federal Members of Parliament.[3]
27. All accommodation expenses and incidental expenses (for example, the cost of a shower) incurred by employee truck drivers as part of work-related travel must be substantiated with written evidence (for example, a receipt).
The paragraphs relating to truck drivers are 24-31.
To your second issue, I would be interested to know which "payroll providers" aren't complying with the ATO DSP instructions about which payments to include in the parent period total amounts?
Let me summarise the ATO requirements that were provided to payroll providers to ensure their products complied. All payments included in the pay event are included in the payer total gross payments amount (parent period gross/W1), except for exempt amounts:
That is, for those expense allowances that have ATO measures in place, where the conditions are all met, the PAYGW may be varied to zero. It is still a payment subject to withholding, it is not exempt.
Deanne
Okay, so as per the award 18.3 (c) (i) the overnight allowance is declared as an allowance?
But the meal allowance as per TD 2023/3 24. ?
What about TR 2004/6
16. Where a taxpayer receives a bona fide travel allowance or a bona fide overtime meal allowance and incurs deductible expenses in relation to it:
•
Where the deduction claimed is more than the reasonable amount, the whole claim must be substantiated with written evidence, not just the excess over the reasonable amount.
•
Where the allowance received is not shown on the employee's payment summary and is not greater than the reasonable amount and it is fully expended on deductible expenses, the allowance received is not required to be shown as assessable income in the employee's tax return. Where it is not shown, a deduction for the expense cannot be claimed in the tax return - refer to paragraph 12
Hiya @Michael-d 🤓
Sorry, I thought your question was specifically about the amount of an accommodation travel allowance that met the conditions to have the PAYGW varied to zero, so my answer was addressing that, where the tax determination specifically states that truck driver employees don't have an "ATO reasonable amount" to test against the travel accommodation allowance to determine if any portion of that payment may have its PAYGW varied to zero. There isn't. Just like there's no ATO reasonable amount for overseas travel accommodation.
Yes, I agree that TR 2004/6 applies here, but not those paragraphs, instead paragraphs 72-75 apply to explain that, in order for truck driver travel accommodation allowance deductions to be permitted, there are specific substantiation requirements. This is why there is no "ATO granted" PAYGW variations on truck driver travel accommodation allowances that may be applied at the time of payment by the employer. The Commissioner will determine that when the employee does their tax return and substantiates their claim.
Here are the steps you would have followed when setting this truck driver travel accommodation allowance pay code up:
Firstly, the award stipulates it must be paid. Next, in order to determine the taxation, super guarantee and reporting attributes of a payment, it starts with the purpose and circumstances of the payment.
Again, because the question you raised was about the portion of those expense allowances that have an ATO measure that, if the conditions are met, have their PAYGW varied to zero and how those payments with PAYGW of zero should be included in the parent period gross total, then yes, they should, but truck driver travel accommodation allowance isn't one of those allowances that has an ATO measure and the PAYGW is not varied at all.
That was the full context of my answer, Michael. Sorry I didn't break it down into this detail. Payroll is complex 🤪
Yes, truck driver travel meal allowances, as per the ATO reasonable rates specified in TD 2023/3 paras 24-27 (separate meal items) would be tested against the allowance you are paying to determine the treatment for tax, super and reporting. Although I didn't see any clause in the Award about that.
Deanne
Whoops, had those rates the wrong way around: WAS 45.03 and NOW 56.28! Bad typos to make, sorry! 🥴 Deanne
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