How to be compliant for Single Touch Payroll
The new Federal Government initiative of Single Touch Payroll will aim to streamline business reporting obligations regarding certain taxes and wage information. Legislated on the 16 September 2016 under the Budget Savings (Omnibus) Act 2016, Single Touch Payroll (STP) will become mandatory July 1 2018, for employers with 20 or more employees. Single Touch Payroll […]
5 June 2017 — read
The new Federal Government initiative of Single Touch Payroll will aim to streamline business reporting obligations regarding certain taxes and wage information. Legislated on the 16 September 2016 under the Budget Savings (Omnibus) Act 2016, Single Touch Payroll (STP) will become mandatory July 1 2018, for employers with 20 or more employees. Single Touch Payroll will be available to employers July 1 2017, for those who wish to begin voluntary reporting earlier. Under the legislation, employers will be required to report ordinary time earnings, staff wages, Pay-As-You-Go (PAYG) withholding information, and superannuation contributions directly to the ATO, at each payroll cycle. What do you need to do? In order to report the necessary information to the ATO businesses with 20 or more staff (as of April 1 2018) will be required to implement Single Touch Payroll compliant payroll solutions in their business, prior to July 1 2018. Payroll solutions refers to the accounting software, business management solutions or payroll software that you use to process payroll. Already have a payroll solution? Business with 20 or more employees (as of April 1 2018), that are already using a payroll solution will be required to update their software to be Single Touch Payroll compliant before July 1 2018. The ATO has advised that they are working closely with payroll providers to ensure that their products are ready for Single Touch Payroll in 2018. Don’t have a payroll solution? Businesses with 20 or more employees (as of April 1 2018), who don’t have a payroll solution in place, will need to implement one ahead of July 1, that is compliant with Single Touch Payroll. There is currently no requirement for employers with 19 or less employees (as of April 1 2018) to begin reporting through Single Touch Payroll. However, businesses can choose to implement a compliant Single Touch Payroll system if they wish to utilise Single Touch Payroll reporting. Someone else does your payroll? If you have a Tax or BAS agent or third party, who lodges your relevant paperwork your behalf, they will be required to report through Single Touch Payroll from July 1 2018. The ATO is working closely with Tax and BAS agents to ensure they are ready for Single Touch Payroll. Individuals should however check with their agent before July 1 2018, to confirm that they are compliant and ready for Single Touch Payroll. Benefits of updating your Payroll solution Upgrading or implementing a STP compliant system is a great excuse to evaluate the other business systems you have in place, and upgrade them where necessary. Integrating core business systems such as payroll, workforce management, POS, inventory, record keeping and reporting, can be hugely beneficial in streamlining business efficiencies. Not only does its result is greater oversight and compliance, but it also provides a more wholesome and in-depth overview of the entire business, which can help you to make smarter more informed decisions for the whole business. For more information about how to be compliant with Single Touch Payroll, chat to your accountant or visit the ATO website.