Total salary and wages expenses is one of the financial information disclosures on income tax returns of entities carrying on business. This disclosure is unnecessary because the ATO already gets this info from PAYGW disclosures on the business's BAS. Having to work out the payment summary equivalent figures to disclose on a tax return of an entity with a substituted accounting period can be very time consuming. Most people just put in P&L expense (which is not what the instructions require) so it's only a compliance burden for those who try to do the right thing. It's totally unnecessary!
The Board understands that the salary and wage label on the ITR’s are used in the first instance to record a deductible expense so that a taxpayer can calculate their taxable income – at least on the individual tax return. It is also used to cross reference what has been reported through the PAYG W system to provide assurance that businesses aren’t claiming a deduction for salary and wage and not withholding, reporting, remitting or a combination of all of these.