ato logo
Search Suggestion:

Payroll software formula

Last updated 21 October 2012

If you would like to use a payroll software program to calculate the amount to withhold from salary and wages, you can use the following mathematical formula. However, this formula is only relevant if you pay your worker both CDEP and non-CDEP amounts as part of their wages.

A = (C - 115) x 0.15

A is the calculated CDEP withholding reduction amount expressed in dollars, and

C is the CDEP amount of the workers weekly earnings

See also:

You will also need to use the Pay as you go (PAYG) withholding - statement of formulas for calculating amounts to be withheld (NAT 1004).

Rounding of amounts withheld

The amounts you withhold must be rounded to the nearest dollar. If an amount you withhold ends with 50 cents, round it to the next highest dollar.

If you calculate the withholding reduction amount to be less than zero, round the amount to zero.

Software programs

Do not use software programs unless they have been tested for accuracy and produce the exact amounts shown in the CDEP calculation table.