From 1 October 2026, Australian employers are no longer able to pay Award Transport Payments allowances because of changes included in the Treasury Laws Amendment (Tax Reform No. 1) Act 2026.
From a Sybiz Visipay perspective, users should check under Lookups>Payroll>Allowances for any allowances with a category of Award Transport Payments and plan to make them inactive before processing the first pay on or after 1 October 2026. It is recommended to do a test uncheck of the Active flag as soon as possible, as you will not be able to make the item inactive if the allowance is presently attributed to Pay Profile(s) or Saved Pay(s). Attempting to uncheck the Active flag now will let you know whether there are other items such as Pay Profiles that need to be addressed.
To continue paying an allowance for the same purpose from 1 October 2026, new Allowance pay items will be required to reflect the most applicable treatment going forward. Typical examples would be Other Allowance category with T1 Transport/Fares or V1 Private Vehicle as the Other Allowance codes. Do not edit the previous Award Transport Payments allowance; create new allowances if the relevant options do not already exist.
To handle the transition away from Award Transport Payments, the ATO recommends two acceptable methods from a Single Touch Payroll (STP) reporting perspective.
The Cutover method is the simplest, in which no adjustments are required for payments made from 1 July to 30 September — you simply stop paying the Award Transport Payments allowance and commence paying the replacement allowance from 1 October 2026. Remember, STP reporting is year-to-date (YTD), so the static value of the Award Transport Payments allowance will continue to be reported.
The Zeroing Out method requires the YTD amount of Award Transport Payments allowances to be zeroed out with the equivalent amount being ‘paid’ to the new allowance(s). If you choose this method, it must be reported via an Update Event (rather than Pay Event) so as not to disadvantage employees by overstating amounts reported to Services Australia. A further layer of complexity in using this method is the ‘new’ allowance(s) may need to be temporarily set to a Non-Taxable Type if it is ordinarily Taxable, and once the zero out is complete, the allowance should be reverted to Taxable.
For historical reporting requirements, the Award Transport Payments Allowance Category will remain within Sybiz Visipay for some time.
In summary, to navigate this change, Australian Sybiz Visipay employers will need to:
- Plan to de-activate allowances of Category: Award Transport Payments, which may also include removal/replacement in Pay Profiles.
- Ensure an appropriate allowance pay item exists for equivalent payments from 1 October 2026.
- Decide which transition method to use between the cutover and zeroing out.
- Prior to the first pay on or after 1 October 2026, carry out the transition using your preferred method.
- Make the old allowance(s) inactive.
