Incorrect Tax Being Calculated For Full-Time Employee Without a Tax File Number (TFN 000 000 000)
Last updated on JULY 14, 2016
Applies to:Oracle HRMS (Australia) - Version 12.1.3 and later
Information in this document applies to any platform.
On : 12.1.3 version, Australian Payroll
Full Time employee without a TFN.
In system when Earning given is:
$1234, tax calculated will be $604
$1234.88, tax calculated will be $605
According to both the Australian Tax Office, when earnings of 1234.88 is given, the tax should be $604 (so a difference on $1.00)
The ATO tax tables states that cents should be dropped from the calculation. Hence Oracle should be calculating tax on $1234, not on $1234.88 This is backed-up by the ATO Tax calculator which states "Disregard any cents in the total amount, unless a monthly amount."
The issue can be reproduced at will with the following steps:
1. Log into AU HRMS Super User responsibility
2. N: People - Enter & Maintain
3. Assign employee a weekly payroll
4. Assign Tax File Number 000 000 000 to employee
5. Give earnings of $1234.88 and process quickpay
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