Single Touch Payroll (STP) is a relatively new electronic payroll reporting regime which commenced on 1 July 2018 for employers with 20 or more employees. At the beginning of 2019, parliament passed legislation to extend STP reporting to include all small employers (those with 19 or less employees) starting from 1 July 2019.
This follows on from BLG’s previous blog Single Touch Payroll In Practice written by my knowledgeable BLG colleague Adam Birrer, which provides more information about STP and details on how to implement it for your business.
Reporting Software Options
As the move to real-time digital reporting may be a big change for employers, in particular small businesses, the ATO is adopting a supportive approach to enable an easier transition across to STP.
With many small businesses not currently using commercial payroll software, the ATO has stated small employers will not be required to purchase this particular software for STP reporting. However, there will be some no-cost or low-cost reporting solutions available to use including simple payroll solutions, portals and mobile apps. You can review the list of providers on the ATO website here.
If you currently use commercial payroll software, setting it up for STP is relatively easy. Should you need assistance in setting up the system, our team at BLG is happy to assist you. Once this is up and running, it is a matter of lodging the required information to the ATO to remain compliant.
There is help to transition to STP and the ATO have a number of alternative options to assist:
- If you are a micro employer (1 to 4 employees) and rely on a registered tax or BAS agent, you will be allowed to report quarterly for the first two years, rather than each time payroll is run.
- If you are a small employer (19 or less employees), you can start reporting at any time from the 1 July 2019 start date 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, or in areas with intermittent or no internet connection.
As with any new business systems or requirements it is important they are implemented correctly. If you aren’t sure how to proceed with Single Touch Payroll or have some questions, make sure you get in touch with our team at BLG Business Advisers online or by calling (02) 4229 2211.