.png)
This information only applies for pay runs created with a payment date of 1 July 2023 or later, as it is part of STP Phase 2 reporting.
There are slightly different reporting requirements for closely held payees as opposed to other employees.
According to the ATO, a closely held payee is an individual directly related to the entity from which they receive payments.
For example:
- family members of a family business
- directors or shareholders of a company
- beneficiaries of a trust.
Employees that are not closely held are called 'arms-length' employees by the ATO.
Example
Danielle is the owner and director of Tasty Family Treats Café. The cafe has 6 employees (including Danielle) who are a mix of casual and permanent employees. One of the casual employees is Danielle's son, Frank.
Danielle is a closely held payee, because she is a company director (and also because she is a family member).
Frank is also a closely held payee, because he is a family member.
The other employees are not closely held, as they are not family members, and they are not directors or shareholders of the company. These other employees could be called 'arms-length' employees.
There are some different (later) reporting deadlines for closely-held employees. You can learn more in the ATO article Closely Held Payees. If you are not sure, please speak to a qualified advisor or contact the ATO.
What do I need to do in Easy Payslip?
Not a lot! There is a checkbox on the Employees 'Taxes' screen. You should check this option for any employees who are closely held. This field is passed on to the ATO via Single Touch Payroll (STP) reporting. You can choose to finalise your STP reporting later in the year for closely held employees (after the 14 July deadline for arms-length employees).
What if I'm not sure if an employee is closely held?
Talk to your accountant or the ATO — they will be able to help you determine if you are not 100% sure.