Attention Employers: Single Touch Payroll Compliance

You may have recently received letters from the ATO regarding Single Touch Payroll (STP) reporting legislation which will come into effect on 1 July 2019 for businesses with less than 20 employee.

You can find more details about STP on the ATO website:

https://www.ato.gov.au/printfriendly.aspx?url=/Business/Single-Touch-Payroll/

Under STP Reporting, you will send tax and super information from your payroll or accounting software to the ATO as you run the payroll. At the end of the financial year, you'll need to finalise your STP data. You will no longer have to give your employees a payment summary for the information you've reported and finalised through STP.

You will no longer need to provide ATO with a payment summary annual report.

The necessary actions required to make your business STP compliant vary depending on which payroll system you use. We recommend you contact your payroll provider or this office to confirm your payroll system is capable of STP reporting.

In this newsletter we listed some frequently asked questions on this topic. We hope they are of assistance in your 2019 EOFY payroll finalisation and transition to STP reporting from 1 July 2019.

Q: Should I commence STP now or wait till 1 July 2019?

A: For small employers ie under 20 employees the company is only obligated to report from 1 July 2019.In our experience it is easier to finalise 2019 in the old way and commence STP in July 2019.

Q: Am I required to report my first pay run in July 2019 under STP?

A: No. you can opt in STP any time between 1 July 2019 and 30 September 2019. For example if you opt in STP in August, in the first STP pay run, you would need to report the year to date wages.

Q: What do I need to do before opt in STP reporting?

A: If you are on a STP ready software, we recommend you conduct a review of your payroll settings to ensure relevant information are correct such as employee details, pay category settings. For example, salary sacrifice setting, allowance etc. if you are going to moving to a new software, please ensure payroll information is set up properly.

Q: I am already STP Compliant. Do I need to do any year end procedure?

A: If you are STP compliant in 2019 you will need to do a STP finalisation by 14th July 2019. Once you finalise your STP data employees will be able to see their payroll data on their myGov account or via their Tax agent. If your system allow you to produce PAYG summaries, you may choose to provide them to employees for their reference however you are not required to be lodge with Taxation Office. When finalising the data please ensure payroll categories such as Reportable Fringe Benefit, Reportable Superannuation and allowances are included correctly.

Should you require assistance regarding STP compliance, please contact your client manager in our office.

LOEWY CONSULTING PARTNERS

Important: Clients should not act solely on the basis of the material contained in this newsletter. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Client Alert is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval.