This article explains how to record ATO income tax payments in Simple Fund 360, including all applicable tax components:
- ATO Supervisory Levy
- Prior Year Under/Over Provision
- ATO Interest Paid or Received
- ATO Fines & Penalties (e.g. General Interest Charge)
These can be recorded using the More Details panel when posting to the 85000 – Income Tax Payable account.
This transaction can be recorded through the Transaction List or matched through Transaction Matching when using a bank feed. The process to complete both scenarios is the same.
In this example, the Transaction List will be used:
Instructions
| From the Main Toolbar, go to Accounting. | |
| Select Transaction list | |
| Select New Transaction. | |
| Select Bank Statement. |
2. Enter the Basic Transaction Details
| Field | Example |
|---|---|
| Date | 21 January 2024 |
| Reference | 123 |
| Description | ATO Income Tax Payment |
| Account | 60400 – Cash at Bank (Credit) |
| Amount | Total amount paid (e.g. $9,153.00) |
3. Add Tax Components in the More Details Panel
Next to the 85000 – Income Tax Payable line, click More + to open the More Details panel.
Fill in the applicable fields:
| Field | Description |
|---|---|
| Financial Year | The financial year the tax relates to (e.g. 2022–23) |
| SMSF Supervisory Levy | Enter levy amount (e.g. $259) |
| Under/Over Provision | Enter any prior year adjustment (e.g. $493) |
| ATO Interest Paid | Enter interest charged by the ATO (e.g. $35) |
| ATO Interest Received | Enter interest refunded by the ATO (e.g. $0) |
| Fines & Penalties | Enter ATO-imposed fines or GIC (e.g. $45) |
Select Post to save the transaction.
For a payment of $9,153, SF360 would post the following breakdown:
| Component | Amount | Ledger Account |
|---|---|---|
| Income Tax Payable | $9,307 DR | 85000 – Income Tax Payable |
| ATO Supervisory Levy | $259 DR | 30400 – ATO Supervisory Levy |
| Prior Year Adjustment | $493 CR | 48600 – Prior Year Under/Over Provision |
| ATO Interest Paid | $35 DR | 37700 – Interest Paid |
| ATO Interest Received | $0 CR | 25100 – Interest Received |
| Fines & Penalties | $45 DR | 38200 – Fines & Penalties |
| Bank Payment | $9,153 CR | 60400 – Cash at Bank |
Note: If any component is not applicable, simply leave the field blank.
Income Tax Instalments
Click here for instructions on recording instalments.
Important: Once the payment has been posted to the general ledger (as a Bank Statement transaction type), the levy will appear as a line item in the Transaction List.
When the transaction is clicked on and edited, the levy amount can be found in the Tax Instalment Details panel by selecting the More + to the right of the 85000 amount.
Supervisory Levy and Deductibility
Currently, the supervisory levy is always treated as fully deductible in Simple Fund 360.
Note: Where the fund has no assessable income, Simple Fund 360 will automatically treat the levy as non-deductible.
If you wish to treat it as non-deductible, you will need to create an expense account and select Expenses - Management and administration expenses as the tax label and use that account for the supervisory levy.
This will get picked in the SMSF Annual Return under Section C Label J2 (provided the Non-Deductible percentage of General Expenses is 100%) under Members | Fund Pension Policies.
Newly Registered Funds
Simple Fund 360 automatically adjusts the levy amount for newly registered funds.
- For example, if a fund is first registered in the 2014 financial year, SF360 will double the levy from $259 to $518, with an adjustment of $130.
How does SF360 determine this?
The system checks the Date Formed field in Fund Details.
If the date formed falls within the current financial year, SF360 will apply the adjustment automatically.
The date formed in the example above is 01/08/2013. The current year is the 2014 financial year; Simple Fund 360 will make the adjustment of $130 for the levy.
Is it possible to post an Income Tax Payable/Receivable amount without entering a financial year in the more details section?
No, it is not possible to create a transaction with 85000 - Income Tax Payable amount without selecting the financial year in the Income tax payable more details section.