Single Touch Payroll (STP), is an Australian Government initiative to reduce employers' reporting burdens to…
Single Touch Payroll (STP) is a new accounting method introduced to employers to make the reporting of employees’ tax and superannuation information to the Australian Taxation Office easier. Using accounting software that makes use of STP, employers can now send the relevant information every time payroll is utilised, and employees are paid. The information will be sent directly through software or a sending service provider.
What to do if you have 20 or more employees
Single Touch Payroll was initially implemented in July 2018 for employers with 20 or more employees currently on their payroll. There is still time to switch over to the necessary software, as well as the option for deferral (where applicable). Your current software provider or tax advisor can help talk you through the set-up process and protocol, so don’t hesitate to ask for help.
What to do if you employ less than 20 employees
Due to the success of STP in larger companies, legislation is currently before parliament to allow the processes to be utilised by smaller businesses (or more specifically, those with 19 or less employees). As it stands, the Bill has been passed by the Senate (with amendments to help STP better meet the needs of this demographic) and has now been referred to the House of Representatives for consideration.
Smaller businesses can opt to report through STP now and, as above, current software providers can be of help. It is not currently mandatory for STP to be used by smaller businesses – and by July 2019, there will be a range of reporting options on offer.
The Australian Taxation Office has asked software developers to build low-cost STP solutions for businesses with 1-4 employees (often referred to as micro employers), with packages starting at affordable rates; at around $10 p/m and including simple payroll software and apps that can offer guidance and make overall use smoother.
There will be a number of different reporting options on offer to help employers. For example, enabling registered tax or BAS agents to report quarterly on their behalf. Exemptions will be permitted to those with no internet connection, or an unreliable connection, and there is a range of information relating to reporting (when considering salaries and wages, superannuation protocol and other similar factors), so be sure to make use of all the information on offer before switching.