By Josip Matanovic and Katherine Taylor
Recently we shared with you an article by Cameron Tilley and Parminder Nijjhar about Single Touch Payroll (STP). Following on from this article, from 1 July 2019 the ATO requires all employers to report through STP which essentially allows the ATO to capture wages and super information for every pay run processed. The ATO will use this information to match the STP information to their employer and employee records.
During the first year the ATO has released a statement noting there will be no penalties for mistakes, missed or late reports however you should aim to setup the STP as soon as possible. If you make a mistake in your STP report, you can correct the error in the following report. The ATO will not penalise you for making mistakes you correct.
At the end of the financial year, you will need to finalise your STP data. This will act as a declaration to the Commissioner of Taxation to state you have completed your reporting for the financial year. You will no longer have to issue your employees a payment summary.
There are a number of options available for employers to report their STP obligations. Their options will depend on the number of employees they have. This is broken down into three groups:
- large employers who have 20 more employees;
- small employers who have been 5 and 19 employees; and
- micro employers who have less than 4 employees.
If you are currently using STP enabled software to process payroll you will need to set-up your software to correctly report information to the ATO. If you are running older versions of software or have previously completed your payroll manually you will need to consider your options to meet ATO STP reporting obligations. Our firm is a Xero partner and recommends Xero Payroll ($10 per month) to address your STP requirements.
We can assist in ensuring you are good to go with STP, whether it be to review your existing setup and registration with the ATO or establishing a new payroll system and connection with the ATO.
Should you be interested in exploring this as an option further, please do not hesitate to contact your Vincents adviser to discuss this further.
Alternatively the ATO has also complied a range of no-cost and low-cost STP solutions. For further information with regards to this please visit – https://www.ato.gov.au/business/single-touch-payroll/in-detail/low-cost-single-touch-payroll-solutions/
An Important Message
While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents. Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.