It is now a matter of months before all employers will be required to comply with the Single Touch Payroll (STP) provisions. Previously, only “substantial” employers (20 or more employees) were required to comply but from 1 July 2019, all employers will be brought into the system, so if you have tuned out previously – now is the time to listen in!
What is Single Touch Payroll?
It is a new way for employers to report their PAYG and super contribution information to the ATO after every pay run. Previously reporting was done either monthly or quarterly and super contributions were not reported. According to the ATO, Single Touch Payroll information will be used to prefill your activity statement in the future.
If you are using payroll software, it is highly likely that it will be STP ready, however, there are some instances where this is not the case - please contact us if you are not sure about your situation. If you do have STP ready software, the transition should not be difficult but the initial set up is critical. Read some of our key takeaways from the first six months of STP for substantial employers. Again, we are able to walk you through the whole process to make sure it is right.
Options for small employers
If you do not currently use a payroll software, there will be different options available to you. The ATO have put the call out for developers to create simple, low cost software and apps for less than $10 a month. This may suit some businesses but it is worth considering your accounting and record-keeping needs more broadly, rather than payroll in isolation. “Micro employers” (1-4 employees) will be presented with different options including initially allowing their registered tax agent to report quarterly on their behalf. Finally, if you have no internet connection or an unreliable connection, you may be eligible for an exemption.
We will be hosting at least one seminar in the next few months about STP for businesses that will be impacted from 1 July onwards, so keep an eye out for the invitation!