Single Touch Payroll – Are you ready?

Approx read time: 2 minutes

Have you got 20 or more employees? Are you STP ready?

STP is going to change the way in which employers will report their PAYG and Superannuation information to the ATO. From the 1st of July 2018, if a business has 20 or more employees it will be required to report PAYG and super after every “Pay event”. A Pay event effectively means each Payroll run that you do, whether this is weekly, fortnightly or monthly. Your Payroll software should now be in the process of getting you ready and providing you with the relevant information and instructions on how to report this information to the ATO.

So why the change?

The ATO is advocating that the STP system will have the following benefits:

  • Remove the need for Employers to provide PAYG Summaries to their employees from financial years in which the employer utilized STP
  • Eliminate the requirement for annual reconciliations to the ATO Commissioner
  • Prefilling of PAYG amounts on Business Activity Statements
  • New employees can fill out TFN Declarations and Super Choice nominations online
  • Early intervention will be possible for employers struggling to meet their PAYG withholding and super obligations.

 

Employers with 20 or more employees should be ensuring their payroll details are up to date, and in line with the details the ATO holds for the Employee.

For example, if you have an employee whose legal name is James, but your payroll system has him as Jim, you will need to change this to assist data matching.

It would be beneficial to take the next month to ensure your payroll system is up to date. Employees should also be encouraged to sign up for a MyGov account as soon as possible.

The data will be fed to the ATO through the STP Gateway, in which Employers with have AUS Key like access. Meaning that if the ATO website/portal is down, the STP Gateway will not be impacted.

If you have concerns over STP, you should contact your Payroll Software provider or your accountant.

If you have less than 20 employees, you can opt-in for STP – but it will not be a requirement for you until the 1st of July 2019.