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Correcting an incorrect pay (New Zealand)

When an incorrect pay has been processed the options below can be followed for correcting that pay, depending on how long it has been since the pay was processed.

These are the only options for changing a pay that has been updated as you cannot edit a closed pay in Exo Payroll. We recommend taking time to understand the overall situation and why a change to a pay is required. It could be that simpler and easier alternatives are available such as:

  • An incorrect date that falls in the correct month and year can often be tolerated.
  • An over or under payment (or incorrect PAYE amount), can often be corrected by adjustments in the next pay processed.

When a change needs to be made in a pay that has already been updated, there are two options (both shown below):

Option A is best if there have been no (or very few) changes made since the incorrect pay was updated. If there have been a lot of changes (perhaps if other pays have since been entered) then option B may represent less work overall.

Option A – Restore the update backup

Perform a restore of the backup taken when the pay was updated (Utilities -> Restore). This will take the software back to when that pay was open and you can make any necessary changes to that pay.

Once the changes have been done and any reports required have been reprinted then update the pay again and redo any other work that was done after the original pay had been updated. It is important to emphasis that ALL changes made in ALL software modules after the chosen backup was originally created will be lost. This includes any Timeclock pollings – Time and Attendance users should not restore unless they are sure they can work-around any "lost" pollings.

Option B – Process a correction payment

Process a One Off Pay using the same dates as the original, incorrect pay but with figures entered as negatives of what was in the original pay. This negative pay will act to "cancel out" what is currently in the Payroll. Then complete a second One Off pay with dates as the original pay, but with the correct pay information. The 3 pays together will show you the variance between the original and what should have been paid.

When making any changes to completed pays in the software you should always consider the following:

  • Any pays that are corrected and which have already been "Filed" with (and have had the PAYE paid to) IRD, will require IRD being advised of the change of details for the employee(s). This would normally be done using an IR344 form. You should also contact IRD to discuss how to deal with the paying of the extra PAYE or getting back the extra PAYE.
  • If the dates of the updated pay are incorrect, there is no practical option to change those incorrect dates. In most situations the pay(s) with the incorrect dates have already been "Filed" with IRD. If these pays have already been "Filed" it is recommended not to worry about the incorrect dates of the pays.

Adjustments to the employee

If the amounts of the corrected pay(s) are different to what the original pay(s) had, then the difference will need to be either paid back to the employee or deducted from the employee. If you have processed an adjustment payment and completed any adjustent filings with IRD, then there are 2 ways to do this:

  • Managed outside the payroll: i.e. pay any underpaid values to the employee via cash, cheque or a direct credit, or request the amount back from them.
  • Managed within payroll: Pay any variance as an allowance or any overpayments can be clawed back via a deduction in the next pay period. Note in this case this would be a post tax allowance or deduction as the tax has already been corrected in the correction pays.

Need more help? You can open the online help by pressing F1 on your keyboard while in your software.

You can also find more help resources on the MYOB Exo Employer Services Education Centre for Australia or New Zealand.

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