Wondering about Single Touch Payroll and how it will affect you?If you are a business with one or more employees then you will need to get on board....now!
SINGLE TOUCH PAYROLL… HOW IT WILL AFFECT YOU
I’m sure by now you’ve all heard about Single Touch Payroll but are you wondering what it is and how it affects you?
If you are a business with one or more employees then you will need to get on board….now! Effective 1 July 2019, for businesses with 19 or fewer employees, it is a legal requirement that you must now send your employees salary, tax and super information directly to the ATO each time a payroll is run. This information must be reported after every pay run has been finalised and no later than the employees pay date. This means that using payroll or accounting software that offers Single Touch Payroll will make it much easier to be ATO compliant.
If you are an employer with 20 or more employees you should already be using Single Touch Payroll.
The first step for employers is to determine how you will report through STP. This will depend on the size of your business and if you currently use payroll or accounting software. If you don’t use software you can report the salary information through your BAS agent or Accountant or maybe investigate a no cost or low cost STP solution (see link below for the different cost options).
At the end of the financial year you will need to finalise your STP data which is a declaration to the Commissioner of Taxation that you have completed your reporting for the financial year.
You will no longer need to give your employees a payment summary for the information you have reported and finalised through STP. Once you finalise your data your employees or their registered Tax Agent will be able to lodge their income tax return using the STP information available in the ATO online services.
If you don’t think you will be ready to report your STP before 30 September 2019, an employer or their Registered Agent can ask the ATO for a deferral. In most cases, this request will be granted.
From an employees perspective, if your employer is using STP you will no longer receive a paper payment summary from them. Your payment summary information will be available in the ATO online services account that your accountant will be able to access for you.
Most employers have until 31 July 2019 to check their employee’s income statement and finalise it for the year.
If you need any assistance with setting up or understanding your Single Touch Payroll please give us a call & we’d be happy to help.
– Dean Kennedy