Earnings Types

In Marlin HR, all payments are made to employees using either an Allowance Type or an Earnings Type. Which one to use depends on whether the ATO describes the particular payment type as being an "Allowance".

The ATO defines Allowances as amounts paid by employers to cover anticipated costs or as compensation for conditions of employment.

Each payment to an employee must be reported to the ATO via Single Touch Reporting and provide the appropriate reporting codes so that the ATO system knows exactly what type of payment it was.

These codes are selected on each Earnings Type and Allowance Type when it is created in Marlin HR and are automatically included in the STP reporting each time the Earnings or Allowance type is used on a payrun to pay an employee.

The ATO has defined different reporting codes for each type of payment and the codes specified for "Allowances" are different to those specified for "Earnings" (i.e. all other payments).

This is why it is very important to use the correct payment type (i.e. Allowance or Earnings) in Marlin HR to pay employees.

See Adding & Updating Allowances for further information on Allowances in Marlin HR.

Also see Allowances and Reimbursements and Employment Allowances on the ATO website.

Commonly Used Earnings Types

To view, add or customise Earnings Types, select System > Earnings from the Marlin HR menu.

Shown below is a list of the most commonly used Earnings Types, each with the values most commonly selected by our customers.

How to Create a New Earnings Type

Select System > Earnings from the Marlin HR menu.

Click on the Add icon to add a new blank Earnings Type.

Enter a meaningful name for the Earnings Type.

Optionally enter a Pay Advice Comment (this will be printed directly below the Earnings Name on the Pay Advice whenever this Earnings Type is used on a payrun).

Tick the Active checkbox so that the new Earnings Type will be available for selection on a payrun or as a recurring earnings type for an employee in Employee Maintenance.

Tick the Is Ordinary Time Earnings (OTE) checkbox if this payment is OTE and is thus to be included in the calculation of the employer superannuation contribution.

Select the appropriate values in the remaining fields (click on Hint beside each field for relevant information).

Click on the Save icon.

How to Apply a Recurring Earnings Type to an Employee

If you regularly pay an employee a particular payment type, adding it to the employee in Employee Maintenance will save you from having to manually add it to each pay run and will ensure you don't forget it.

If the amount differs from pay to pay or isn't payable on every pay, you can still add the Earnings Type to the employee but enter the amount as $0.

Then, all you have to do on the weeks that the payment is payable, is to enter the amount on the pay run.

First check that the Earnings Type exists in your system and is setup correctly (select System > Earnings from the menu).

Open Employee Maintenance and select the employee.

Select the Pay Details tab.

Click on the Add icon in the Recurring Earnings section.

Select the Earnings Type from the drop down list.

Select the Department that the employee works for.

Enter the amount in $ or Hours (depending upon how you set up the Earnings Type) then click on the OK button to add the payment to the employee.

From now on, each time you initialise a Normal Pay, the payment type (with the amount you specified above) will automatically be applied to this employee.

Before finalising the pay run, you have the option to change or remove the amount.