Paid Parental Leave Scheme

I worked for a company which had to pay Parental Leave to one of its employee.

1. Each fortnight we got payment from Centerlink.  I had to download and print a letter from Centerlink to file in an employee folder for archiving purposes. 
2. The money were paid into the company account. In accounting software I created 3 new accounts:  Liability Account "Parental Leave Funds" (2 - other Liability), Income Account "Parental Leave Received" (8 - other Income) and Expense Account "Parental Leave Paid" (6 - Expense).
3. Each time the company got the money from Centerlink I credited the Liability Account. Entries: Bank - DR, Parental Leave Funds - CR. In MYOB Banking - Receive Money, Tax Inclusive.
4. Payroll category: I created a new Wages category: Parental Leave (it replaces Salary, thus place tick next to Salary). Also tick Override Wages Expense Account and Select the newly created Parental Leave Paid Account.
   Payroll category: Tick Exempt on Superannuation tab.
5. MYOB: Card of the employee - Payroll Details - Standard Pay - Parental Leave category to the amount that is to be paid each pay period. All the other fields - 0.
6. The money stays in the Liability account and needs to be cleared each time the payment is made. Entries: Parental Leave Funds - DR, Parental Leave Received - CR. In MYOB Accounts - Record Journal Entry. 
7. And the last but not the least, Once the employee returns to work, In MYOB open the employee card  and click Reset to Original Amounts (on top).

From 1 July 2011 a company should provide Paid Parental Leave to all eligible employees who have been with the company for 12 months or more prior to the expected date of the birth or adoption. For these long-term employees, the Family Assistance Office will advance funds direct to business. These funds are sent in three instalments or fortnightly over the 18 weeks. For employees who have been with the company less than 12 months, the Family Assistance Office will make the payments directly to them, unless the company chooses to do so. Employees can apply to the Family Assistance Office up to three months before the expected birth or adoption.


Australia's first national Paid Parental Leave scheme provides 18 weeks' pay at the National minimum wage for eligible, long-term employees who are the primary carer of a newly born or adopted child.
Parental leave payments won’t cost business anything – they are paid from the Federal Government direct to your business and then you pay your employee.
As an employer you will be responsible for administering Paid Parental Leave for your eligible employees. You will not need to make superannuation contributions on Parental Leave pay.
It will not increase your payroll tax liability or workers compensation premiums.