What is Single Touch Payroll – “STP”?
Single Touch Payroll will change the method by which your business will report payroll data to the Australian Taxation Office. STP will be compulsory for most employers from 1st July, 2018. This is part of an Australian Government strategy to modernise compliance and data integration involving the ATO, Employee Entitlements Guarantee and Superannuation Guarantee.
A brief ATO overview is available here.
The aim of this article is to advise you about the impact on your business and the steps you will need to take.
At a glance
- STP will allow employers to report payroll information to the ATO in “real-time” directly from their payroll software, i.e. immediately after each payday process is completed;
- Once STP comes into effect, employers will no longer be required to provide Annual Payment Summaries.
- STP will generate data to be viewed on the ATO/MyGov portals, for employees and employers to access the latest payroll, tax and superannuation information.
When will STP become compulsory for your business?
- Employers with 20 or more staff – 1st July, 2018.
- Employers with between 1 – 19 staff – deferred for one year – 1st July 2019.
How can you get ready for STP?
You will need to update your payroll software to be compliant with STP reporting requirements.
When should you upgrade you payroll software?
At Communicat we support several payroll systems including MYOB EXO, MYOB Advanced, Arrow and Tencia. We are in constant contact with the software developers regarding STP and other enhancements. We will contact you on a timely basis to arrange your upgrade.
The ATO has identified the first 12 months as a transition period, to provide employers with sufficient time to achieve STP compliance without concern about penalties. Nevertheless it is highly recommended that your upgrade be implemented before 1st July, 2018 since that is the date STP will become compulsory.
What if my software provider does not release an update for STP?
If your payroll software is unable to comply with STP you will need to change to a more modern payroll software package. The transition period will give you time to introduce any necessary software changes.