If you’re an employer post July 1st, 2018 then according to the ATO your life is about to get a little bit simpler. The Australian Tax Office is rolling out a new system from July 1st called Single Touch Payroll. Whether you’re an accounting firm or a dog groomer, if you have any employees Single Touch Payroll is going to be relevant to you.
What is it?
Single Touch Payroll is the new system for reporting PAYG and Superannuation contributions to the ATO. It is an entirely automatic process, designed to replace the previously cumbersome system. STP will happen every payroll cycle, and will remove the potential for any errors and double-handling of information.
When does it start?
The first step as a business will be to do a ‘headcount’ of your employees on April 1st. If you have 20 or more employees your business will be considered ‘substantial,’ and you will need to implement Single Touch Payroll from July 1st this year. If you have 19 or fewer employees, the commencement date for Single Touch Payroll is not until July 1st, 2019—although it is still advisable to begin planning now.
Who should be included in the headcount?
You should include the following employees in your headcount: full-time; part-time; employees on leave; casual employees on the payroll from March, 2018.
You should NOT include the following employees in your headcount: separate contractors; staff hired by other organisations (e.g. temps); employees who have ceased work prior to April 1st
How does it work?
Essentially, the employer will not need to do anything differently. As Single Touch Payroll is completely automated and your accounting software providers will provide updates to enable this to operate, the information will be sent to the ATO when any payroll is lodged. You can still elect to pay your employees either weekly, fortnightly or monthly.
Is there a transition period?
Yes, there is. For the first twelve months of the new system, employers will not be able to be penalised for incorrectly utilising Single Touch Payroll.
Where should I go for more information?
The Australian Taxation Office has an abundance of information on its website here.
What if I want to talk to someone in person?
That’s what we’re here for! If you have any questions about Single Touch Payroll, then please don’t hesitate to call us on (03) 95232277, or drop us a message at our website here and we’ll get back to you.