Single Touch Payroll (STP) is an initiative by the ATO that changes the way employers report on employee payments including salary and wages, PAYG withholding and superannuation.  

Under STP, employers send payroll information directly to the ATO in real time as they pay their employees via their payroll software. Reporting each pay run saves time and resources for businesses at the EOFY because you have already submitted payroll information to the ATO throughout the year.

If you have 19 or less employees Single Touch Payroll is mandatory from 1 July 2019. The introduction of STP is part of the ATO’s plan to streamline business reporting and move it to a digital format that will improve accuracy and help reduce non-compliance.

Some quick facts

  1. Under STP you’re required to send payroll reporting information to the ATO every time you pay your employees. To enable this direct submission, many employers will need to upgrade or replace their payroll system to meet their payroll reporting obligations to the ATO.
  2. If you prepare payroll manually, you are not Single Touch Payroll compliant. To meet your reporting obligations, you need to purchase a payroll solution or engage an accountant, bookkeeper or a payroll provider to meet your payroll reporting obligations on your behalf.
  3. A bookkeeper can handle your STP reporting, you must authorise them to lodge to the ATO on your behalf. This is usually done through a letter of engagement at the beginning of your working relationship
  4. STP will save employers valuable time around EOFY as they will no longer need to process payment summaries and give employees real-time visibility of tax and super information.
  5. Businesses with less than 20 employees can voluntarily implement STP anytime from 1 July 2018 to take advantage of streamlined reporting and save valuable time around EOFY.

Follow this link to the ATO's Single Touch Payroll resources

 

If you don't have a bookkeeper - now might be a good time to start - contact me for a free STP consultation on jenny.bayly@firstclassaccounts.com or 0417 612 602.