What is Single Touch Payroll (STP) and when does it apply for your business?

What is Single Touch Payroll (STP) and when does it apply for your business?

STP is being introduced to align payroll with more regular reporting. It will not only identify non-compliance more quickly, but also ensure better collection of unpaid entitlements and penalise employers who repeatedly offend. At the end of each pay an employer must report ALL payment information to the ATO. These include; salaries and wages, PAYG withholding and superannuation payments.

What do you need to be ready?

  • Employers need to count the number of employees on their payroll at 1 April 2018.

If they have 20 or more employees, STP compliance is required from 1 July 2018. If they have 19 or fewer, STP starts from 1 July 2019, although you can start early.

  • Appoint an STP Champion

This is usually the payroll manager and they are a centralised team member who becomes the subject matter expert with single touch payroll.

  • Employers should have an AUSKey in place

An AUSKey is a secure login that identifies the employer when using government online services. You will also need to ensure that you have access to the ATO Access Manager.

  • Ensure employee information is up to date.

For data that is mandatory (first and last name, birth date, address and suburb) ensure that this is correctly documented in your payroll system.

  • Ensure your payroll software is STP ready

If you run your payroll through MYOB Live or Xero, you shouldn’t have to change your system.  If you use a manual system, you will need to take other steps to ensure you comply.

Benefits to an Employer

Regular reporting will ease the end of year pressure with information reported through STP pre-filling into your business activity statements. Employers who report an employee’s details through STP will not have to provide employees with a payment summary at the end of the financial year or the ATO with a payment summary annual report for their employees. TFN declarations will also be conducted through STP, eliminating the need to send these to the ATO.

Benefits to an Employee

The ease at which information can be accessed by an employee will also simplify the end of year process. They will easily be able to see their year-to-date information online through myGov, check if their superannuation has been paid and have information pre-filled into myTax.

Unsure?

If you’re not sure whether you need to take action now, please contact your accountant at Hoffman Kelly and they will assist you.

2018-05-01T10:24:54+00:00

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