Single Touch payroll is here for larger employers (with a team of 20+). Actually… it’s been here for a while- since 1 July 2018. Not everyone is on top of these changes still so here’s what it is, what it means and what you should be doing.
Essentially, this is a change to how and when small businesses are required to report payroll activity. Previously, you were required to report on this activity once a year. Now, it’s after every pay day.
Larger employers are currently required to be reporting payments such as:
- salaries and wages,
- pay as you go (PAYG) withholding
from your payroll solution, each time you pay your employees.
Annual PSARs are no longer required (if you use Single Touch Payroll), as employees will be able to access this information from their MyGov Accounts.
If you fall into the 20+ employee category, and haven’t started STP, don’t stress. There are some exceptions:
- Some payroll software providers have been granted more time to update their products to comply with these changes. Check if your product has a deferred start date.
- If your software was ready for 1 July 2018 but you weren’t, you will need to apply for your own deferred start date. Contact us if this is the case and you’re feeling a bit lost!
If you’re sitting at under 20 employees, when will STP come into effect?
It’s expected to be expanded to include employers with 19 or less employees from 1 July 2019. You can however elect to use STP before 1 July 2019, if your software is ready.
What will change with Single Touch Payroll?
The following information must be reported on or before the day you withhold from a payment (the pay day):
- payment information, including salary or wages, allowances, deductions, etc.
- withholding amounts
- superannuation liability information or ordinary times earnings (OTE).
It’s important to keep in mind that it’s not enough to just report your data, it has to be reported in the specific way the ATO wants it. Make sure your software is set up to do so… if you’re on Xero like most of our clients, you won’t have any issues.
If this is sounding a bit overwhelming or you just aren’t sure if you’re doing it properly, get in touch and we’ll sort you out.