Single Touch Payroll
ARE YOU READY?
The ATO has introduced a new system called Single Touch Payroll (STP), which changes the way employers report their employees' tax and superannuation information to the ATO.
From 1st July 2019 it is compulsory for all employers to comply with Single Touch Payroll legislation. This will require the use of software, either your own or through us, to lodge your payroll and this will have to be done each payroll run. It will now be compulsory to use software that offers STP.
Note that STP will also be highlighting employers who are late with paying superannuation. Therefore it is important to ensure that Superannuation is paid on time. We can offer this service for you as well.
The information you used to report to the ATO once a year via payment summary annual reports will need to be sent to the ATO after each pay run. Those reports must be submitted digitally, using a very specific format, meaning that you will no longer have to do the following at EOFY:
A payment summary annual report to the ATO, stating how much the business had paid in salary or wages, the PAYG withheld, and some superannuation contributions made.
A payment summary for each employee, stating wages or salary received, the income tax deducted from their pay, and reportable superannuation contributions made on their behalf.
The reasons the payment summary annual report and the payment summaries will no longer be required with STP are:
Payment summary annual reports - as you’ll be updating the ATO on a pay-by-pay basis, you won’t need to prepare a payment summary annual report anymore. You’ll just let the ATO know when you’ve made your last pay run of the financial year for your employees.
Employee payment summaries - won’t need to be sent to employees anymore, so employers won’t be required to produce them. The ATO will use STP reports as the sole record of salary/wages paid, taxes deducted, and superannuation contributed. Your employees will be able to see the information that would normally be on their payment summary by logging on to MyGov or through a Registered Tax Agent.
Give us a call to chat about using online accounting software solutions and get your business ready for Single Touch Payroll.
How does this effect you?
For Employers with 20 or more employees, STP reporting started gradually on 1 July 2018.
For Employers with 19 or less employees, Parliament has recently passed legislation to extend STP reporting to all employers from 1 July 2019.
As it is now a requirement by the ATO for the majority of payroll entities, we can assist with the setup of the STP system for you over the coming weeks, to ensure that you are compliant in time for the 1 July 2019 due date.
Micro employers (1–4 employees) will have a number of alternative options that are not available to other employers – such as initially allowing us (as your registered tax agent) to report quarterly, rather than each time you run your payroll.
We can report this for you while we are doing your quarterly BASs (please contact us to discuss our fees and your requirements).
We can also offer payroll services for clients with more than four employees. Please contact us for a quote.
I need to start using STP
The ATO has asked software developers to build low-cost STP solutions at/or below $10 per month for micro employers – including simple payroll software, mobile phone apps and portals, please find the below link for more information and the options available to you.
We are offering the STP service on Intuit and Xero, and can also set-up the software for you for $150+ (based on your individual circumstances and does not include the monthly subscription) to ensure that you are compliant with the ATO’s STP requirements.
It is important to act NOW before the deadline, as the ATO may issue penalties in the future to entities who fail to comply with the ATO’s new STP requirements. Please contact us either by email or phoning us at the office on 02 9211 5411 to ensure that you are compliant and avoid any possible penalties being imposed on you by the ATO.