Reckon / Quickbooks – Accounts Hosted and PC versions – How to set up and use ABA files to pay suppliers/creditors

Here is the procedure to set up and use ABA files to pay creditors (For Reckon Hosted and some earlier Quickbooks versions) –

Before you can prepare an electronic payment file, you need to complete the following steps. (> means Click)

First - Set Up the a bank account in R for Online Banking

Open the bank account you wish to enable for online banking

•  Go to the Lists menu, and > Chart of Accounts. The Chart of Accounts opens.
• Select the bank account you want to enable, right-click and then select Edit Account. The account details open ready for you to edit.

1.     > the Online Bank Details tab.

2.     > to select the Online Account Access check box. R makes a number of fields that relate to online banking active. Enter mandatory information about the online bank account set up with your bank.

3.     Complete the following details:

·           > the Financial Institution drop-down arrow and select the bank. This may take a few seconds to process;

·            Enter the code in the Branch Code field to identify the branch for the financial institution. This code is known in Australia as a BSB number;

·           Enter the account number in the Account Number field;

·           > the Account Type drop-down arrow and select the type of account
You may choose cheque, savings, credit card, money market or line of credit;

·           > to select Include Balance Record if you want to include a balance record for online banking files (ABA format) that you generate. This applies if you plan to pay employees or suppliers by generating online banking files (ABA format) in Reckon. Most banks require online banking files to include a balance record within the ABA file format. You should check with your financial institution first;

·           Enter an APCA number in the APCA number field for this account if it is different from the Default APCA number for your company. The APCA number entered in account details always overrides the default APCA number entered in company banking preferences for all online banking transactions using this account.

4.     Click Save & Close.

Second – Set up Suppliers and Employees for Online Banking

Updating Suppliers:

1.     Go to the Suppliers Centre then > Suppliers Tab;

2.     > Double Click a Supplier;

3.     > Bank Details Tab > Enter Account Name (of Supplier), their Bank Account Number, Bank Name, Branch Code (BSB eg 083245, 6 digits) > OK;

4.     Repeat for all suppliers to be paid using ABA files, or that supply a bank account to pay (not Bpay suppliers usually),

Third  – Process Transactions and Create Online Banking File

Pay Bills

This involves processing transactions as normal, but at the Pay Bills window, Reckon should identify payments set up for banking online and have those ready to include when creating an online banking file. So ensure at the bottom the bank you set up for ABA id=s selected, and next to that the Payment Method is “Bank Online”. Finish transaction with Pay Selected Bills. Then Pay more Bills for the next suppliers to pay or Done to finish.

Create an online banking file:

1.     Go to the Online Banking Centre: > (top menu) Banking menu and > Online Banking Centre;

2.     Scroll to the section To Bank (at bottom);

3.     Choose the date you want the payment to be made, using the calendar from the Date to be Processed  field or today's date as defaults;

4.     Enter a payment description eg Creditors or Bills or Pays. If no payment description is entered, a description of “payment” will display in the ABA file by default;

5.     Tick payees from the list. Each payee must have a bank account defined for them under their employee or supplier record. This includes details for Bank Account Name, Number and Branch Code. In addition, employees must have an employee number;

6.     > Preview ABA File if you wish to review the ABA file before creating it;

7.     > Create ABA File. Reckon displays the standard Windows Save As dialog box with *.ABA entered in the file name at the end;

8.     Enter a name for the online banking file (leaving the .ABA) and choose a location to save it, such as desktop. Reckon provides a default folder within the installation directory called Export Files/ ABA Files. You may choose to save the ABA file in this directory, or in any other directory of your choice;

9.     > Save;

10.   Your ABA file is now ready for upload to the relevant financial institution;

11.   Follow their online instructions to upload a payment file.

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Reckon One – Simple Online Accounting – Reckon One Support, User Guides and How to use Reckon One

Have you started with Reckon One?

It is the Reckon online accounting software where you pay for the modules you need – starting at $5 month, you can enter data, report on GST for BAS, online backup and 24/7 support. Then invoicing, bank feeds of transactions into the software, is $13 month, add payroll (unlimited) $18 month – each is billed monthly. See all about Reckon One.

Need to learn Reckon One?

Want some videos and manuals?

Training Reckon ONE

Live Webinars - http://go.reckon.com/training-one/ starts at live webinars to attend/book

The Next tab is Videos page - http://go.reckon.com/newreckonone-videos/

The Next tab is Recorded Webinars - http://go.reckon.com/reckon-one-recorded-webinars/ - (getting Started, Core Modules, Invoices, Projects (Jobs) and Bank Data Module) and more are in the Academy – free sign-up!

YouTube videos - payroll

Payroll set up https://youtu.be/3t_yQ1F5wew

Process Pay Run https://youtu.be/T4_V1PjT5BY

User Support & Guide download from - http://home.reckon.com.au/support/Home/ReckonSupport/InstallationUpgradeGuides.aspx

Community Reckon One - https://community.reckon.com/reckon/categories/reckonltd_reckon_one  where you can search your topics at the top search box

Knowledge Base (KB) – FAQs and Search links - http://kb.reckon.com.au/index.asp

Also don't hesitate to contact Reckon if you have any questions on 1300 756 663 or This email address is being protected from spambots. You need JavaScript enabled to view it. .

Or call us! – 0407 361 596 Paul for free help up to 30 min!

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Business Tax Tip – Tax on Annual Leave and Long Service Leave on Termination / Resignation Payout

Calculating the tax on unused annual & long service leave on termination / resignation needs to be carefully determined to ensure compliance. The ATO explains what applies at Schedule 7 – Tax table for unused leave payments on termination of employment. Here is some of the info on that ATO page –

Tax on Annual Leave and Long Service Leave – Tax Table for Unused Leave Payments

For payments made on or after 1 July 2015

This document is a withholding schedule made by the Commissioner of Taxation in accordance with sections 15-25 and 15-30 of Schedule 1 to the Taxation Administration Act 1953 (TAA). It applies to withholding payments covered by section 12-90 of Schedule 1 to the TAA

Using this table

You should use this table if you pay an amount to an employee for unused leave on the termination of their employment or office.

Unused leave payments on termination of employment or office include:

• Annual leave
• Holiday pay
• Leave loading
•  Leave bonuses
• Long service leave

NOTE - Before calculating the amount to be withheld, you must work out if the payments are being made as a result of a genuine redundancy, invalidity or an early retirement scheme.

For more information, refer to Withholding from unused leave payments on termination of employment

Working out the withholding amount – depends if TFN provided

When a TFN is provided

The amount to withhold is calculated using the table below.

If the post-17 August 1993 lump sum payment from normal termination is less than $300, you must withhold the lesser of the following:

• The amount worked out using the table below
• 32% of the payment.

Rounding of withholding amounts

Withholding amounts calculated by applying this table are rounded to the nearest dollar. Results ending in 50 cents or higher are rounded upwards. If a TFN is not provided, ignore cents when calculating withholding amounts

Marginal Rate Calculation

To work out the marginal rate, you must:

1. Using the relevant PAYG withholding tax table, work out the amount to withhold from your employee’s normal gross earnings for a regular pay period;
2. Divide the amount of the payment by the number of normal pay periods in 12 months (12 monthly payments, 26 fortnightly payments or 52 weekly payments);
3. Ignore any cents;
4. Add the amount at step 3 to the normal gross earnings for a single pay period;
5. Use the same PAYG withholding tax tables used at step 1 to work out the amount to withhold for the amount at step 4;
6. Subtract the amount at step 1 from the amount at step 5;
7. Multiply the amount obtained at step 6 by the number of normal pay periods in 12 months (12 monthly payments, 26 fortnightly payments or 52 weekly payments).

NOTE - Do not withhold any amount for:

• Higher Education Loan Program (HELP) debts
• Trade Support Loan (TSL) debts
• Financial Supplement debts

Normal gross earnings

Normal gross earnings are all payments, except those relating to termination payments, received in the last full pay period of employment. This includes taxable allowances, overtime and bonuses. Therefore, your employee’s normal gross earnings should be taken to be the earnings relating to the last full pay period worked.

Where your employee’s pay fluctuates significantly over a number of pay periods, we will accept an average of gross taxable earnings for the financial year to date over the number of pays received

Example

The following example uses the Weekly tax table (NAT 1005) effective from 1 July 2018.

Beth retires on 31 December 2018. She qualified for long service leave after 10 years of service, with further leave accruing on each completed year of service.

She is not leaving because of genuine redundancy, invalidity or under an early retirement scheme.

This week Beth also receives her normal weekly earnings of $1,155. She has quoted her TFN and has claimed the tax-free threshold. Therefore, the amount withheld is calculated using column 2 of the Weekly tax table.

Details of payment for long service leave:

• Pre-16 August 1978 component = $3,690.00
• 16 August 1978 to 17 August 1993 component = $7,700.00
• Post-17 August 1993 component = $10,890.00

Amounts to be withheld:

• Pre–16 August 1978 component subject to withholding

              = $3,690.00 × 5% = $184.50

The marginal rate calculation is used to work out the amount to be withheld from the pre-16 August 1978 component.

• 16 August 1978 to 17 August 1993 component

                   = $7,700.00 × 32% = $2,464.00

The post-17 August 1993 component of $10,890.00 is also to be withheld at the marginal rate. To simplify the marginal rate calculation for this employee, the pre-16 August 1978 component and the post-17 August 1993 component are added together first: $184.50 + $10,890.00 = $11,074.50

Now apply the marginal rate calculation to the sum of the two components.

Marginal rate calculation
Step	Instruction	Result
1	Amounts to be withheld from normal gross earnings ($1,155)	$236
2	Divide the amount of the payment by the number of normal pay periods in 12 months ($11,074.50 ÷ 52)	$212.97
3	Disregard any cents	$212
4	Add the amount at step 3 to normal gross earnings for a single pay period ($1,155 + $212)	$1,367
5	Work out the amount to be withheld from the amount at step 4 ($1,367)	$310
6	Subtract the amount at step 1 from the amount at step 5 ($310 − $236)	$74
7	Multiply the amount at step 6 by the number of normal pay periods in 12 months ($74 × 52)	$3,848

The amount to be withheld from the three components of Beth’s unused long service leave payments is $6,312 ($2,464 + $3,848). See Rounding of withholding amounts.

The total amount to be withheld is then $6,548 ($236 withholding from normal earnings plus $6,312 withholding from long service leave).

When a TFN has not been provided

If your employee who is receiving the unused leave payments has not provided you with their TFN before the payment is made, you must withhold 49% from the payment.

If your employee is a foreign resident who has not provided you with their TFN, you must withhold 47% from the payment.

NOTE - If your employee believes that for their circumstances the amount you withhold will be too much, they may apply for a variation to reduce the amount of withholding.

For more information refer to PAYG withholding – varying your PAYG withholding

NOTE - QC 46069 contains precisely the same content as QC 45606, which is Schedule 7 – Tax table for unused leave payments on termination of employment.

For more information see HERE

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