The commencement date for Single Touch Payroll (STP) is fast approaching, so what is it and what do you need to do to prepare?
All employers are required to do a headcount of active staff currently employed. The date to base the headcount on is 1st April 2018. Whilst you do not have to report your findings to the ATO, you should keep a copy of your headcount on file.
When doing your headcount ensure you include all the following employee types
- Full time employees
- Part-time employees
- Casual employees who worked at any time during March 2018
- Employees based overseas
- Employees who are on leave
- Seasonal employees
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If your headcount is less than 20 employees, you will likely have to commence reporting via a STP enabled solution from 1 July 2019 (subject to legislation being passed)
20 or More Employees – now what?
Whilst much of your payroll function won’t change, there are some tasks that you should attend to prior to 1 July 2018.
Start by talking to your payroll software provider to ensure that they will have a STP enabled solution ready for your business by 1 July 2018. Most payroll software providers are prepared for the changes, however keep in mind that it is up to the employer to ensure they have reported, not the software provider.
Before you start reporting it is a good idea to do a quick audit of your systems to ensure that you have all of your employees’ details correct within your payroll software. Items such as current address should be checked and updated if necessary. Also ensure that your business details are accurate such as your trading name, ABN and current address, as this information will be submitted to the ATO once you start reporting.
When you start STP reporting, none of your current payment due dates for superannuation or PAYGW will change; only the ATO will receive information about wages paid and superannuation accrued in real time. This also means that many software providers will prohibit revisions of pay runs after they are completed, however there are methods to report adjustments to the ATO within set timeframes. It also means that you need to ensure that you are upholding your employer obligations, such as paying superannuation on time or reporting superannuation guarantee charge within the specified timelines if you pay after your due date.
Finally there is the possibility that your business will no longer need to provide PAYG Payment Summaries to employees or an PAYG Payment Summary Annual Report to the ATO.