Single Touch Payroll (STP) is a payday reporting arrangement where employers need to send tax and superannuation information to the Australian Taxation Office (ATO) from their payroll or accounting software each time they pay their employees. Large employers (20 employees or more) has gradually been STP reporting from 1 July 2018, and until now it has been optional for small employers.
The Basics of STP Reporting
- With STP reporting, employers no longer need to provide payment summaries to employees for payments reported through STP
- Employers no longer need to provide payment summary annual reports to the ATO at the end of the financial year for STP reported payments
- Employees can view their year-to-date payment information using the ATO’s online services
- Employers need to complete a finalisation declaration at the end of each financial year
- Employers need to report employees’ super liability information for the first time through STP. Super funds will then report to the ATO when the employer pays the super amounts to employees’ funds
- From 2020, the ATO will pre-fill some activity statement information for small to medium withholders with the information reported through STP
Never Fear, the ATO is Here
The ATO will adopt a supportive approach to help small employers undertake this transition. It is working with software providers to develop low and no-cost reporting solutions including simple payroll solutions, portals and mobile apps.
- The ATO will offer micro employers (1 – 4 employees) help to transition to STP and a number of alternative options, such as allowing those who rely on tax agents (ie Progue) to report quarterly for the first 2 years, rather than each time payroll is run
- Small employers can start reporting any time from 1 July to 30 September 2019. The ATO will grant deferrals to any small employer who requests additional time to start STP reporting
- There will be no penalties for mistakes, missed or late reports for the first year
- The ATO will provide exemptions from STP reporting for employers experiencing hardship
The information contained on this website and in this article is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. Taxation, legal and other matters referred to on this website and in this article are of a general nature only and are based on our interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.
Published on March 14, 2019 by Progue
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