Single Touch Payroll – What do you know? If the answer is very little then keep reading. We are going to be answering the questions: What is Single Touch Payroll? When does my business need to start using STP? Do I have STP compatible software? And how does STP benefit my business?
What is Single Touch Payroll?
It is a new way that employers will report payments to the ATO such as:
- Salaries and wages, including allowances and deductions
- PAYG withholding
- Superannuation information.
Employers are to report their tax and super information every time they pay their employees, not just monthly or quarterly, from their payroll solution. You do not need to provide payment summaries to your employees for the payments you report through STP.
When does my business need to start using Single Touch Payroll?
It starts from 1 July 2018 for employers with 20 or more employees.
For employers with 19 or less employees, you will need to start reporting through STP 1 July 2019.
Employers you should know that you need to perform a headcount of your employees dated back to 1 April 2018. This is to determine if you need to start STP reporting from 1 July 2018. Your headcount must include:
- Full-time employees
- Part-time employees
- Casual employees and seasonal workers who were on your payroll 1 April 2018 and worked any time during March
- Employees based overseas
- Employees absent or on leave (paid or unpaid).
Do I have Single Touch Payroll compatible software?
If you are thinking that your entire payroll processing needs to change it doesn’t. It’s just that after every pay period your payroll software provider needs to send the required reporting information to the ATO. So how do you know if your software is capable of doing this? Below is a list of some of the current software providers who are STP ready for 1 July 2018.
QuickBooks Online Payroll
Paypac Payroll Services
I have a registered tax agent, can they manage my STP reporting?
Yes they can report through STP on behalf of the Business.
How does STP benefit my business?
- Streamline and automate your business reporting obligations.
- The ATO is able to pre-fill the BAS W1 and W2 for employers.
- Your employees will have timely access to their year to date payment and super information from their employer if they have a myGov account.
- End of year won’t be such an arduous task as you no longer have to process payment summaries, part-year payment summaries or submit end of year reporting to the ATO.
For more information about STP visit the ATOs website
Important information* during the first 12 months that you report through STP you will be exempt from an administrative penalty for failing to report on time. Unless you have received a written notice advising that a failure to report on time in the future may attract a penalty.
Need advice on the changes happening to payment reporting? Give us a call.
Bryn deals directly with assisting small to medium business clients, whether in early stage or mature, in relation to their Accounting, Taxation, and Business Growth. If you’d like to speak with Bryn about growing your business, contact us