QuickBooks HelpQuickBooksHelpIntuit

Processing Finalisation Events using an Update Event in QuickBooks Online

by QuickBooks Online Payroll Standard Updated 5 months ago

This article will guide you through completing your end of year processing for Single Touch Payroll (STP), like processing a Finalisation Event using the update event functionality.

Before you start

If you prefer, this article will show you how to create and lodge a finalisation event with the ATO. This provides additional functionality not included in an update event, such as:

  • The ability to bulk import Reportable Fringe Benefits (RFB) amounts for employees
  • Sending notification emails from the platform once the finalisation event has been successfully lodged

And finally, before you start with creating a finalisation event using an update event, make sure you at least lodge your last pay run for the financial year. Once that has been successfully lodged with the ATO, you can follow these steps to create the finalisation event.

It's important to note that Employees will NOT be able to access their Income Statements from their employee portal or Swag. They will only be available via the employee's myGov account (under the Income Statement section) or by contacting the Australian Taxation Office (ATO). 

Create a Finalisation Event using an Update Event 

  1. Select Employees from the left navigation.
  2. Select Reports and then select Single Touch Payroll.
  3. Select Create Update Event.
  4. Select the relevant Financial Year and Pay Schedule, then select Create.  

Employees with multiple pay schedule

If you've been paying your employees using multiple pay schedules throughout the financial year, you don't need to complete a finalisation event for each pay schedule for that employee.

Rather, you only need to complete the finalisation event for the default pay schedule the employee is assigned to, for example, an employee is assigned to a fortnightly pay schedule but also have also however been paid in an 'ad hoc' pay schedule throughout the year. As the employee's default pay schedule is fortnightly, all the employee's year-to-date (YTD) earnings will be reported in the fortnightly finalisation event.

You'll then be taken to the update event page where you'll see a list of employees and their year-to-date payroll data. The employees in this event are employees from that Pay Schedule that have been paid in the financial year who have not previously been marked as Is final in an earlier event.

If you want to add an employee who has previously been marked as Is final, select Actions and then Add Employee

What steps should I now take before I lodge the finalisation event? 

There are a few actions to perform before proceeding with the lodgement. Select each heading to get more information.

To access an Excel version of the data shown in this event, select Actions and then Excel. You'll then be able to reconcile this report with other payroll reports (such as the Detailed Activity Report) to check that the figures match.

If you notice a Warnings tab, there are issues with the lodgement that must be rectified before proceeding with lodgement: Learn how to trouble validation warnings for STP

Once all warnings have been fixed, you can refresh the data by selecting Actions and then Refresh Data.             

This is only required if you have employees with reportable FBT amounts that need to be entered. You can enter the amount manually for each employee by selecting the Pencil icon, enter the grossed up amount and then select the Green tick icon.

You may need to seek advice on which FBT deductions are reportable. Further information on FBT can be found here.

You'll notice that the screenshots include 2 RFBA columns – one for Entertainment and another for Other. The number of columns that appear here for your business will depend on your FBT settings as configured in the ATO Settings.

This is an essential step to indicate to the ATO that the employees have no further payments to be made for the financial year. This will also update the employee's Income Statement to 'Tax ready' so they can then lodge their tax return.

To mark employees as Is final, Select Actions and then Mark all as final.

If you are lodging as a Tax/BAS agent you must obtain approval from your client to lodge the event prior to actually lodging the finalisation event. 

Note: If your ATO Settings are set to lodging as the Employer or lodging as an Intermediary for multiple employing entities, you are not required to complete this step.

Select Actions and then Request Client Authority to commence the process. We suggest you add a note to indicate the event relates to a finalisation event. The users added to the list will be notified via email that there is a finalisation event waiting to be approved.

Notes on Fringe Benefits

  • You must only enter the grossed-up taxable value of these benefits
  • Do not enter any cents in the amounts
  • Do not include any FBT amounts in the employee's gross earnings
  • The amount entered must be the YTD amount. If any amounts have previously been entered in other events, they will be displayed. If you need to update an employee's YTD amount, enter the actual YTD amount in the field so that it overrides the existing amount, for example, the amount added here will not be in addition to the existing amount showing for the employee

Lodging the Finalisation Event

Once the above steps have been completed you can start the lodgement process by selecting Lodge with ATO. The finalisation event will then submit to the ATO.   

If you have the notification setting Email me when there is a Lodgement error switched on (via the My Notifications screen) you'll be sent an email if there is an error with the lodgement.

Additional setting for tax/BAS agents

Before you are able to lodge the finalisation event, you must:

  • Select the Registered Tax Agent option when choosing who is lodging; and
  • Assign the authority who has approved the event. If the selected authority's status is showing as awaiting authorisation, the Lodge Update Event button will be disabled. This is intentional, because only an approved authority can be assigned to the event

Lodging an amended Finalisation Event

If, after having successfully lodged a finalisation event for a specific pay schedule, you realise that an adjustment or adhoc pay must be processed for the same financial year, you must process an amended finalisation event.

You must also do this as quickly as possible to ensure the employee does not use an outdated Income Statement to lodge their tax return. If you're not sure of when you'll be able to do this, we strongly suggest you create and lodge an update event for the employee and mark as is not final so that the status of the employee's Income Statement is no longer 'Tax ready'.

To lodge an amended finalisation event, select Create Update Event from the Single Touch Payroll page and complete this process again.

Have any other questions for our team?

If any of your questions were left unanswered, we'd love to hear them!
Pop over to our QuickBooks Community's discussion on payroll processes where you can ask your questions, have them answered by qualified QuickBooks Online experts, and hopefully help others with the same questions out in the process.

Content sourced from Employment Hero

QuickBooks Online Payroll Standard

Sign in now for personalized help

See articles customized for your product and join our large community of QuickBooks users.

More like this