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MYOB – Quickbooks – Tax Threshold and Leave Loading – which do I use?

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Client emailed with the following query –

MYOB Quickbooks Bookkeeping

Bookkeeping Help

I am confused – 

Does a Tax-Free Threshold + Leave Loading apply to a full time employee who is entitled to annual leave + personal leave loading?

 As opposed to a Tax-Free Threshold + No Leave Loading? Does No L Loading apply to casual staff who are not entitled to annual & personal leave?

 I just noticed the No Leave Loading in the MYOB Tax rate lists as I was manually calculating a PAYG from the ATO tax tables. When I referred back to another employee tax rate, she is classified as + leave loading. But so are casuals. Can you help?

Explanation –

Leave loading is 17.5% ONTOP of annual leave (was introduced in the war time to average what a worker got in overtime, so they received similar while on holidays)

Whether you select a threshold with or without the leave loading depends on the Modern Award.

And it applies to part-time and full-timers, NOT casuals at all.

As I recall, leave loading was in the Retail Award – so YES – ” a Tax-Free Threshold + Leave Loading apply to a full time employee who is entitled to annual leave + personal leave” (there is no personal leave loading)

If the award did not enforce/include leave loading, you would select Tax-Free Threshold + No Leave Loading

All your staff will be Tax-Free Threshold + Leave Loading

For Casuals, you just don’t tick on the Leave and Leave-Loading Categories in their payroll set up, at all – they don’t apply, and the correct tax rate should be calculated.

For more on leave loading, see

Explaining Annual Leave Loading – what is it?

Employee Leaving or Terminated – Unused Leave

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Author: accountkeepingplus

Administration, bookkeeping and compliance for small business, and Self-Managed Super Funds (SMSF) Training, trouble-shooting, or we can do the books and payroll for you! Self Managed Superannuation Fund Service Provider, Free support MYOB Certified Consultant, Reckon/QuickBooks Professional Partner.

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