Single Touch Payroll (STP)
Single Touch Payroll is a regulation that requires a business to report their pay information with each pay run.
What do I need to do as a business owner?
- Employees’ gross pay, tax, and supa must be reported to the ATO with each pay run or (pay event)
- Consequently, to meet these reporting requirements you will need to use an STP enabled compliant software
Q. Does this affect my business?
A. Yes, if you have employees
What if I have a Bas Agent or Tax Agent?
Your BAS or Tax Agent will need a statutory declaration designating them as your STP representative
Will STP change our workflow?
The way you pay your employees will not change however you will need to ensure that you are reporting with an STP enabled software.
An STP finalization will be done at the end of the year as a result, the annual payment summary will no longer be required to be lodged with the ATO. Employees will also no longer receive a payment summary.
Who is affected and when is the single touch payroll deadline?
- Businesses with more than 20 employees: STP started from 1 July 2018
- Businesses with less than 19 or less employees: STP has now been extended to cover all employers from 1 July 2019
Need more time?
- The ATO has guidelines to help businesses with special cases for instance where additional time or an exemption is required.
Are you employing 1-4 employees?
Reporting options for your business with 1-4 employees are available subject to eligibility: This means that instead of reporting with each pay run you may qualify for quarterly reporting. To find out more visit the ATO https://www.ato.gov.au/business/single-touch-payroll/concessional-reporting/
Non-arm’s length employees (Closely held payees)
- You are exempt from reporting through STP for your closely held payees for the 2019-20 financial year.
- However, from 1 July 2020, you will need to report through STP.
For more information about exemptions and deferral applications please visit the ATO website https://www.ato.gov.au/business/single-touch-payroll/concessional-reporting/ or contact your Tax professional
Your options for switching to single touch payroll
- You will need to be connected to an STP compliant online software that is to say the software has been approved as being able to submit your employee’s data to the ATO
- If you currently use excel for example you will need to find a service that will convert your data into a compliant digital report see https://www.ato.gov.au/business/single-touch-payroll/how-to-report/.
- The ATO has published a list of no-cost and low-cost solutions for single touch payroll. Click here or visit the ATO website www.ato.com.au/stp or https://www.ato.gov.au/business/single-touch-payroll/how-to-report/
Missed the STP Deadline?
The good news is that there are options still available for instance you can submit an application for more time or to vary your STP reporting frequency subject to eligibility. If you have an STP enabled software you can start reporting with your next payrun.
visit https://www.ato.gov.au/Business/Single-Touch-Payroll/Concessional-reporting/ for more info
Get STP Ready with UFirst Bookkeepers: We are here to help you 🙂
Please book your free STP advisory appointment here
Your friendly bookkeeper,
Bridget Chenje CPA