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Single Touch Payroll (STP)

What is it

  • Compliance reporting by employers from 1 July 2018
  • Only affects employers with head count of 20 or more employees as at 1 April 2018.
  • Reports payment of salaries and wages, PAYG and Superannuation Guarantee (SG) each pay runs.
  • Reporting could extend to all employers (i.e.) 19 and less employees subject to legislation being passed in the Parliament.

How to determine if STP applies to you.

Do a head count of your employees on 1 April 2018, not their full time equivalent (FTE). This includes the following

  • full-time employees
  • part-time employees
  • casual employees and seasonal workers who were on your payroll on 1 April and worked any time during March – there are exemptions to counting seasonal workers who were employed for a short time only
  • employees based overseas
  • any employee absent or on leave (paid or unpaid).

Don’t include the following in your headcount:

  • any employees who ceased work before 1 April
  • casual employees who did not work in March
  • independent contractors
  • staff provided by a third-party labour hire organisation
  • company directors
  • office holders
  • religious practitioners.

Getting Ready for STP

  1. If you are using a payroll software, make sure that they support STP reporting. This could mean that you need to update the most current version of your software.
  2. Stay informed by checking any updates from the ATO websites. Check that the ATO has your correct contact details and have the right authorisation in place.
  3. Review your business processes and ensure that your staff are aware of the STP reporting. Check that you are correctly paying your staff, calculated their entitlements, addressing any over or underpayments and maintain accurate records such as emails, addresses, names and date of birth.
  4. Apply more time if necessary. Some Digital Service Provider (DSP) have a deferral in place with the ATO. If this is your software provider, make sure you seek a deferral reference number from them provided by the ATO. If you are not ready for STP reporting, apply for a deferral from the ATO through with online form.

ATO is working together with Businesses, Bookkeeper and Accountants by providing supports through the first year of reporting. As this is a transitional year, penalties will generally not apply.

For more details on STP contact your Accountant or search through the ATO website by following this link.