1. About Single Touch Payroll（STP）
Single Touch Payroll (STP) is a new way of reporting tax and super information to the ATO. If you are using a solution that offers STP reporting, such as payroll or accounting software, you will send your employees’ tax and super information to us each time you run your payroll and pay your employees.
The information is sent to ATO either directly from your software, or through a third party – such as a sending service provider.
2. What the changes mean for you？
At the end of the financial year, you need to finalise the information you’ve reported through STP for each of your employees by 14 July. If you are unable to do this by the due date, you can apply for additional time.
You need to finalise your employee’s STP information through your STP-enabled solution by making a finalisation declaration. You can make a finalisation declaration for an employee any time during the financial year (for example, for employees who have ceased employment), or after the end of the financial year up to 14 July. ATO has provided additional time for employers to make a finalisation declaration in their first year of reporting through STP. Employers who start reporting in the 2018–19 financial year will have until 31 July 2019. If you need more time, you can apply for an extended due date to make your finalisation declaration.
You may be subject to a penalty if you do not make a finalisation declaration or, alternatively, provide payment summaries by 14 July each year. You may be exempt from giving payment summaries and a payment summary annual report for the amounts you reported through Single Touch Payroll (STP). This information will be made available to your employees online through myGov. Your employees can also request a copy of this information from ATO.
3. The rules of reporting through Single Touch Payroll
Each time you send ATO your Single Touch Payroll (STP) report it will include minimum reporting requirements in order for you to meet your STP obligations.
You are required to report a pay event to the ATO on or before the pay day. The pay day is either the payment date stipulated in the electronic transaction to your financial institution or, if you did not stipulate a date for payment, the date you intend to make the payment into your employee’s bank account.
If you include out-of-cycle payments in your regular pay event, report the date of your regular pay day. The report must include, at a minimum, each employee with an amount subject to withholding paid in that regular pay cycle.
The report may include information for other employees.
You must report the year-to-date values of gross salary or wages, allowances or other payments (as relevant), deductions and PAYG withholding for each employee included in that pay event.
If you pay above the minimum super guarantee (SG) liability, report this higher amount if you can’t separately identify these in your payroll solution.
4. When to start
The start date for STP reporting will depend on your number of employees:：
|≥ 20 employees||1 July 2018|
|5-19 employees||Start reporting any time from 1 July – 30 September 2019. Or apply for more time to get ready.|
|1-4 employees||You will have the option for your registered tax or BAS agent to report your STP information quarterly, rather than each time you run payroll. This option will be available until 30 June 2021.|
|Employers with closely held payees||Start date|
|≥ 20 employees||Start reporting any time from 1 July – 30 September 2019. Or apply for more time to get ready.|
* closely held payee means the payee is directly related to the entity from which they receive payments, for example:
- family members of a family-owned business
- directors or shareholders of a company
- trustees or beneficiaries of a trust.
Employers may not always pay closely held payees a regular salary or wage, and instead, may draw on income from the business throughout the year. As STP information is reported each time payroll is run, employers would not be able to report their closely held payees this way.
If you’re an employer with closely held payees, there are flexible reporting options available to you.
You have a period of time to correct information reported in a pay event without being liable to a penalty for making a false or misleading statement. ATO calls this correction a ‘fix’.
If you do not make a fix within the required period, you may be liable to a penalty.
6. What Single Touch Payroll means for employees
If you report to ATO through Single Touch Payroll (STP), your employees will see their year-to-date tax and super information by logging in to myGov and accessing ATO online services. Each time you pay your employees, their year-to-date tax and super information will be updated in myGov. Employees can now access and complete pre-filled commencement forms (e.g. Tax file number declaration and Superannuation (super) standard choice) through ATO Online via myGov. Once employees complete and submit the employee commencement forms to ATO, employees also need to print it and provide it to their employer. The employer will enter the information into their system and keep a copy of the form for their records. Employers do not need to send the printed form to ATO.
7. No-cost and low-cost register
Following are the No-cost and low-cost STP solutions currently available:
|Solution name||Solution type||Pricing||Website|
|Reckon Single Touch Payroll||Mobile app||Free||https://www.reckon.com/au/single-touch-payroll-appExternal Link|
|Reckon One Payroll||Cloud based||$10 or less per month||https://www.reckon.com/au/payroll-software/External Link|
|MYOB Essentials Payroll||Web based||$10 or less per month||myob.com/au/accounting-software/essentials-payrollExternal Link|
|Xero Payroll||Web based||$10 or less per month||https://www.xero.com/au/stp/1-4/|
Please visit https://www.ato.gov.au/Business/Single-Touch-Payroll/ for more information.
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The material and contents provided in this publication are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained. We are here to help, contact us.