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Cardis(Enthusiast)Enthusiast
19 Aug 2025

Hi All,

Just wondering if you could answer my question according to the below scenario:


An employer is receiving from the insurance weekly payments as wages compensation due to an injury suffered by an employee. The employer is acting simply as pass through since the amount received by the insurance is than credited onto the employee bank account. For the sake of clearing any doubt, the employer gets $100 by the insurance and then transfers $100 to the employee. There is no top up or similar.


Based on the above facts, is the employer obliged to report the amount via single touch payroll or is the employee responsibility to declare that amount as assessable income when lodging his/her personal tax return?


Really appreciate your help on the matter.

Thank you


554 views
1 replies
554 views
1 replies

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PayrollDeanne(Taxicorn)Taxicorn
19 Aug 2025

Hiya @Cardis 👋


This is typically how workers' comp is managed. The key to understanding your obligations is that the employer pays the employee, regardless of funding provided by the insurer to the employer.


It must be reported in STP2 as per the ATO STP2 Employer Guidance 🤓


Deanne

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