Ruqayyah Snyder
In Australia, employers are required to provide their employees with payslips, which are documents that outline an employee's salary, wages, and other financial details. Payslips are important for ensuring employees receive their correct pay and entitlements, while also helping employers maintain accurate financial records. With the availability of various online payslip generators and templates, creating payslips in Australia is a straightforward process that can be customised to suit an organisation's branding and needs.
| Characteristics | Values |
|---|---|
| Purpose | To ensure employees receive the correct pay and entitlements and to help employers keep accurate and complete records |
| Timing | To be given to an employee within 1 working day of payday, even if the employee is on leave |
| Format | Electronic or hard copy |
| Content | Employee's name, employment status, annual salary or hourly rate, hours worked, gross pay, deductions, net pay, reimbursements, allowances, bonuses, incentive-based payments, pay rate, entitlements, leave balance information |
| Additional Information | Bank name and account number, period the payslip covers, date of payment, employer's business name, organisation number and address |
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What You'll Learn
Include employee name, annual salary/hourly rate, hours worked, gross pay, deductions, and net pay
In Australia, employers are legally required to issue payslips to their employees. Payslips are given to employees at the end of each pay cycle, showing them their earnings, where that money went, and how much they get to take home.
A payslip must contain the following information:
- Employee name
- Annual salary/hourly rate
- Hours worked
- Gross pay
- Deductions
- Net pay
The gross pay should include any loadings, allowances, bonuses, incentive-based payments, penalty rates, or other paid entitlements separate from the employee's wage. For example, if an employee is entitled to a cold work allowance, this should be noted separately from their ordinary hourly rate.
Deductions can include things like tax and superannuation. Superannuation fund details do not need to be included if the employee hasn't notified the employer of their choice of fund or if the employer hasn't obtained the employee's fund details from the Australian Taxation Office (ATO).
The net pay is the amount the employee gets to take home after all deductions have been made. This is the final figure on the payslip.
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Add reimbursements for travel expenses
When creating a payslip in Australia, it's important to include reimbursements for any travel expenses incurred by your employees. These reimbursements are separate from an employee's salary or wages and are not considered ordinary time earnings.
There are a few methods to calculate reimbursement for travel expenses. One common approach is to use a cents-per-kilometre rate, such as the Australian Taxation Office's (ATO) standard rate, which is 88 cents per kilometre for the 2025/2026 tax year. This rate is intended to cover both the fixed costs of owning a vehicle and the variable costs of driving it for business-related purposes. Alternatively, employers can set their own rate, but any amount exceeding the ATO's standard rate will be taxed as part of the employee's income.
Another method is to provide a car allowance, which is a lump sum given to employees to purchase or maintain a vehicle. Car allowances are considered benefits and are typically taxed as income. If an employee receives a car allowance, they can still claim deductions for their business-related driving expenses on their tax return. It's important to note that if an employee uses a company car, they can only claim reimbursement for actual expenses such as fuel, maintenance, and parking.
Additionally, reimbursements can also cover other travel-related expenses such as accommodation, food, drink, and incidental costs. These reimbursements should be noted separately from an employee's salary or wages on their payslip.
By including reimbursements for travel expenses on payslips, employers can ensure they are providing accurate and complete records of their employees' earnings and entitlements. Payslips can be provided in electronic or hard copy format, and employees are entitled to receive them within one working day of payday.
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Record paid family and domestic violence leave
In Australia, employers are prohibited from including certain information concerning family and domestic violence leave on employees' pay slips. This includes:
- A statement that an amount paid to an employee is a payment in respect of the employee’s entitlement to paid family and domestic violence leave.
- A statement that a period of leave taken by the employee has been taken as a period of paid family and domestic violence leave.
- The balance of an employee’s entitlement to paid family and domestic violence leave.
However, it is best practice for employers to record paid family and domestic violence leave on their employees' pay slips in a way that makes the pay slip look as close as possible to how it would have looked if the employee had not taken the leave. For example, if an employee would have worked 7 ordinary hours, including 3 hours in a cool room that would attract a cold work allowance, the employer can issue a pay slip that includes these details, instead of recording that period as paid family and domestic violence leave.
Additionally, the STP reporting category for FDVL amounts must match that of the payment type shown on the employee's payslip. This may be recorded as:
- Gross, if shown as an employee’s ordinary hours of work.
- A payment made in relation to the performance of the employee’s work, including (but not limited to) an allowance, bonus or a payment of overtime.
- Other Paid Leave, where requested by the employee, or before 4 June 2023, where an employer is making use of the grace period contained in the regulations.
If you need to pay FDVL for multiple employees in the same pay with different payslip labels, you will need a separate payment pay item for each to allow for different labels and (potentially) ATO categories. Otherwise, you can maintain a single pay item and update the label and ATO category as required.
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Include employer name, number, and address
When creating a payslip in Australia, it is important to include the employer's name, number, and address. This information typically goes at the top of the payslip. This is a mandatory requirement, as it ensures compliance with Australian business laws and helps employees understand who their employer is and how to contact them if needed.
The employer's name on the payslip should be the legal name of the business or organisation. This helps employees identify their employer officially and can be important for tax and other legal purposes. Including the employer's name on the payslip promotes transparency and clarity in the employer-employee relationship.
The employer's number, such as the business's registration number or tax identification number, is also crucial. This number is used for tax purposes and to identify the business uniquely. Including this number on the payslip helps employees reference it when filing their taxes or dealing with government agencies.
Additionally, the employer's address should be included on the payslip. Providing a physical location of the business adds legitimacy and helps employees know where their workplace is located. This address can also be used for correspondence or legal purposes if needed.
By including the employer's name, number, and address on the payslip, businesses adhere to legal requirements and provide transparency to their employees. This information is vital for record-keeping, tax compliance, and fostering a clear understanding between employers and employees regarding payment and entitlements.
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Add contributions and superannuation fund details
A payslip is a document that details an employee's pay for each pay period. It is given to employees at the end of each pay cycle and shows them what they earned and where that money went, including how much they get to take home.
When creating a payslip, you must include the amount of contributions made during the pay period (or the amount of contributions that the employer intends to make). This includes adding details of the superannuation fund to which these contributions were (or will be) made. This could be the name or the name and number of the superannuation fund.
However, when an employer is required to give a new employee a payslip within 14 days of their first payday, they don’t have to include the superannuation fund name or number if:
- The employee hasn’t notified the employer of their choice of superannuation fund.
- The employer hasn’t been able to obtain the employee’s stapled superannuation fund details from the Australian Taxation Office (ATO).
Other than contributions and superannuation fund details, a payslip should also include the following:
- The employee's name, employment status, annual salary or hourly rate, and bank name and account number.
- The period the payslip covers, as well as the date the payment was made.
- The pay rate, entitlements, gross and net pay, and any applicable bonuses, overtime, allowances, incentive-based payments, or other entitlements separate from the ordinary hourly rate.
- Any deductions from the employee’s pay, for example, income tax, unpaid leave, pension payments, etc.
- Any reimbursements, such as repayments made to employees for expenses related to travel or other business-related costs.
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Frequently asked questions
A payslip is a document that employers must give to employees when they pay their salary. It shows how much the employee earned, when the salary was paid, and any other details concerning their pay.
You should include your business name, organisation number, and address at the top of the payslip. You should also include the employee's name, employment status, annual salary or hourly rate, the hours worked, gross pay, deductions, and net pay.
Employers must give employees a payslip within one working day of payday, even if the employee is on leave.
A payslip generator saves time and ensures compliance with Australian business laws. It automates the process of generating payslips, removing the need for manual calculations and reducing errors.
There are several free payslip templates available online, such as those offered by Xero, ClockOn, Conta, and Payroller. These templates are customisable and can be downloaded as PDFs or Excel files.
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