Single Touch Payroll (STP) is a change to the way employers report their employees tax and superannuation information to the ATO and is done electronically through your accounting or payroll software. The information is sent directly from the software to the ATO. All employers need to ensure that they are compliant by July 1st.
Employers with 20 or more staff should already be reporting to the ATO as this was implemented from July 1st, 2018.
Employers with less than 20 employees have until July 1st, 2019 to begin reporting but I recommend getting the process started now to ensure that there is not a last minute rush and stressful implementation at the end of the financial year.
The process is relatively simple and once you are setup, it really runs in the background with very little for you to do – most of our existing clients who are already on the STP process report that they mostly forget that it exists. There are some distinct advantages – employers who report using STP for the full financial year will not be required to provide employees with payment summaries. Instead this information will be provided electronically to employees by the ATO through an employment income statement and be available on their mygov account. Where employees do not have a mygov account, their tax agent can access this for them or they can contact the ATO for this information.
Long term the ATO is looking to use the STP information to prefill activity statements and reduce the burdon on the taxpayer for monthly IAS statements that report PAYG withholding amounts. This is the same information that is being reported through the STP data so it makes sense that the ATO would use information that you are giving them to pre-fill the reports.
We have successfully assisted clients with the implementation of Single Touch Payroll. Please consider getting on board prior to July 1st and contact the office on 07 5576 0011 if you would like to make an appointment to get setup.