New ATO reporting – Single Touch Payroll

When does STP come into effect?

If you have 20 or more employees on, or after 1st of April 2018 you will have to report via STP from 1 July 2018.

If you have less than 20 employees you will have to report via STP from 1 July 2019. Optional to start from 1 July 2018.

Employers using the closely held employee exemption have received an extension to 1 July 2021 in response to the Covid-19 crisis and will have to start reporting via STP by this date.

What is Single Touch Payroll or Continuous Reporting?

STP involves sending a report to the ATO when each pay run is completed. Each report includes the year to date figures and will overwrite the last report so if an adjustment is made in a prior pay run in the same financial year, then it is automatically corrected. Each report contains the same type of information as the PAYG Payment Summaries at the end of the year.

STP Benefits

You no longer have to prepare and lodge annual PAYG payment summaries at the end of the year.

ATO will pre-fill your wages and PAYG Withholding tax figures in your BAS reducing reporting time.

STP Cautions

This information will add to ATO existing data matching regime. Employers who are late payers of superannuation can expect faster response times in calling for late payments.

What do you need

STP compliant payroll software and internet connection. These can be built into existing accounting software or stand alone software packages.

It is expected that the most popular accounting systems for small business will be ready by 1/7/18. If not, an application must be lodged to delay inception. If your system provider does this, you don’t have to but it is your responsibility to check.

Xero, MYOB AR Live, MYOB Essentials, QuickBooks are expected to be compliant by the due date.

MYOB will be ceasing support for MYOB Edge and MYOB Premier. Depending on how you’re using these products there are possible problems migrating to MYOB AR. Another solution may be required.

If in doubt, you should contact your software provider or our office.

STP Solutions

Our office are specialists in migrating accounting systems and setting up new accounting systems. As ongoing costs can build up by selecting the wrong system or setting up a system incorrectly it is wise to get the best start by having your system match your needs and set up properly at the start.

We can also provide an outsourced payroll solution where we prepare your payroll for you.