Single Touch Payroll (STP) changes the way employers report their employees’ tax and super information to the ATO. It is the next step in streamlining your payroll reporting. It will change the way you report your employees’ payroll information to the ATO. It starts from 1 July 2019 for employers with 19 or less employees. Employers with 20 or more employees have been using this reporting system since 1st July 2018.
You will report payments such as salaries and wages, pay as you go (PAYG) withholding and super information to the ATO when you pay your employees. You can do this through your existing payroll software (such as accounting software) as long as it is updated to offer Single Touch Payroll reporting. Payroll software providers have updated their product. Talk to your provider to find out how and when your product will be ready.
Different STP reporting options will be available by 1 July 2019 to help smaller employers. However, the ATO have said they won’t force employers with 19 or less employees to purchase payroll software if they don’t currently use it.
Micro employers (1–4 employees) will also have a number of alternative options that are not available to employers with 20 or more employees – such as initially allowing a registered tax or BAS agent to report quarterly, rather than each time you run your payroll.
Exemptions to STP reporting will also be available if you have no internet or an unreliable connection.
What does it mean?
When you start reporting through Single Touch Payroll you will send your employees’ payroll and super information to the ATO from your payroll solution each payday.
Your payroll cycle will not change. You can still pay your employees weekly, fortnightly or monthly.
Your payment due date for PAYG withholding and super contributions will not change. However, you can choose to pay earlier.
You may not need to provide your employees with a payment summary at the end of financial year for certain payments you report through Single Touch Payroll. The ATO will make that information available to employees through myGov.
You will have the option to invite your employees to complete Tax file number declaration, Superannuation standard choice form and Withholding declaration online. This feature will not be available immediately.
When you report to the ATO through Single Touch Payroll, your employees will be able to view their year‑to‑date tax and super information through myGov.
Please contact your accountant if you are unsure or have any questions.
Article Written by Joeli Spencer.
Joeli is the Administration Officer at South East Accounting.