Update 24 July 2018
It has been gratifying to see MYOB provide significant support to their clients with the transition to Single Touch Payroll. MYOB’s STP Readiness Checklist is a great place to start if you are a MYOB client with questions about the transition.
As always, we are here to help guide you through the transition.
Earlier this year, we wrote about the transition to Single Touch Payroll from 1 July, 2018. This new system of payroll reporting is designed to make employers’ lives simpler, but like all new systems, there can be uncertainty in the transition. If you are unsure about your obligations, read on.
What is Single Touch Payroll?
Single Touch Payroll (STP) 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.
Does it apply to me?
If you have employees, yes.
If you have 20 or more employees, STP applies to your business now, since 1 July 2018.
If you have 19 or fewer employees, STP is not required to be implemented until 1 July 2019, although we strongly recommend preparing well before this date.
What if I need more time?
The ATO may grant a deferred start date if you are not yet ready. A deferral is a delay of time for an employer to submit their first pay event to the ATO. The report due date is moved to a future date (deferred date).
Depending on your circumstances, a deferral may be initiated either by your payroll software provider or your business.
What if I use a Payroll Software Provider?
Many payroll providers, such as MYOB and Xero have been granted deferrals until the end of 2018. This may be because they require extra time to release compliant updates, or because they wish to roll out STP progressively to their customers.
Your software provider will be able to inform you whether a deferral has been granted for your software product and the deferred date.
If I manage my own payroll?
An employer may request additional time to start Single Touch Payroll reporting. The ATO will consider a number of circumstances before approving any deferral, such as whether you:
- have entered administration or liquidation
- have been impacted by a natural disaster
- are unable to get ready by your software provider’s deferred start date
- are transitioning to a new STP-enabled solution
- are using a customised payroll solution and you need time to configure and test your updated product
- have complex payroll arrangements and need additional time to transition to STP
- are affected by other circumstances which are out of your control
Employers requesting a deferral may need to provide proof of their circumstances to the ATO. You or your registered agent can apply for an exemption using the ATO Business Portal, Tax Agent Portal or BAS Agent Portal.
The employer deferral request form — including specific instructions on how to lodge — is available now via the ATO website.
Of course, if you are granted a deferral, you must continue to meet your existing PAYG withholding obligations.
I’m still not sure. 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.