February 19, 2018

Single Touch Payroll for Business

Daniel Breheny, Director

Are you starting to get ready?

From 1 July 2018, if you have 20 or more employees you will need to start reporting salary information through single touch payroll (STP). This information will need to be reported directly from your STP enabled payroll system to the ATO at the same time that you pay your employees.

A headcount must be taken on 1 April 2018 to determine “substantial employer” status. If there are 20 or more employees on that date (regardless of fulltime/part time/casual status) you will need to report through STP from 1 July 2018 (subject to some exlusions).

If you employ less than 20 employees, STP reporting is optional until 1 July 2019, at which point it is intended that STP will become mandatory for all employers.

If you currently pay employees through payroll software, the software will need to be updated for STP reporting.

You can check whether your payroll software is STP enabled by visiting the product catalogue on the Australian Business Software Industry Association (ABSIA) website.

At present, not many software providers are listed on the ABSIA website so it is important to check with your provider when they will be STP ready.

Some exceptions will apply for rural businesses with unrealiable internet and employers who only have 20 or more employees for a short period of time.

If you don’t currently use payroll software you may need to consider using a STP enabled software solution from 1 July 2018.

Alternatively you can use a registered agent or payroll service provider to report to the ATO on your behalf.

Given we are only five months away from the STP deadline, it is important to make sure that you are on track to meet your STP obligations or speak to your accountant/bookkeeper to create a plan to become compliant.

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