Single Touch Payroll (STP)
Single Touch Payroll (STP) is said to be the largest change to business reporting since the introduction of the GST.
What is STP?
A change to the way that employers notify the Australian Taxation Office (ATO) of employee tax and superannuation.
How does it work?
Information on employee tax and superannuation is sent to the ATO after each “payroll event”. This data can be sent directly from the software, or from a third party, such as a service provider.
When do you have to use STP?
Employers with 20 or more employees
The obligation for employers with 20 or more employees to report via STP began on the 1st of July 2018. Extenstions to the 1st of July 2019 were provided where employers needed more time.
Employers with 19 or less employees
Legislation is currently before parliament. You can choose to report through STP, but the ATO say they won’t force employers with 19 or less employees to purchase payroll software if they don’t currently use it.
There will be different STP reporting options available by 1 July 2019 for this category of employers.
Micro Employers (1-4 employees)
The ATO have called for expressions of interest from software developers to develop low cost (<$10 per month) solutions for Micro Employers. These include simple payroll software, mobile phone apps and portals.
In addition, there will be a number of alternate options that are not available to employers with 20 or more employees. This includes initially allowing your registered Tax Agent to report quarterly, rather than each time you run your payroll.
Exemptions will also be available if you have no internet or an unreliable connection.
What are the benefits?
STP proposes to reduce compliance costs and red tape for employers.
- Online access to payment summaries via myGov
- Employers will no longer have to provide end-of-year payment summaries to employees
- Online access to tax file declaration and super choice information via myGov
- The ATO will be able to pre-fill the gross wages and PAYGW tax deducted items on the BAS. This will eliminate errors and double handling.
Let us answer your STP questions and provide you with the assistance you need to meet your reporting obligations.
Kirra Consulting – Accounting, Bookkkeeping and Tax
Timely. Accurate. Reliable.