As new reporting system is introduced.
National insolvency firm, Jirsch Sutherland says employers should check their business practices are up to par or risk being caught out, upon the introduction of Single Touch Payroll Reporting at the turn of the new financial year.
“Now is the time for employers to review their current payroll processes to ensure they are paying employees correctly and calculating superannuation,” Jirsch Sutherland Partner Trent Devine (pictured) said.
“Employers with 20 or more employees are required to report their payroll information to the ATO each time they pay their employees using Standard Business Reporting software. This software will be linked to the employer’s payroll system or their outsourced payroll provider’s system. By July 1, 2019, employers of any size are expected to be compliant.
“Single Touch Payroll (STP) gives the ATO a real-time window into SMEs’ payroll activities – and it’s important for employers to make sure their business practices are compliant.
“With STP, the ATO will have more information for data-matching purposes, which they can use to combat one of the most common business issues – that is, the use of unpaid superannuation contributions to support cash-flow shortfalls among some SMEs. The new reporting requirements will help ensure employers are meeting their obligations,” he said.
STP has been designed to simplify the administrative processes involved when new staff come on board, by providing optional digital services for completing Tax File Number declarations and choice of super fund forms.
Employees will also benefit, as they will be able to easily access their pay and superannuation details: rather than waiting for their employer to provide payment summaries, they will be able to view their payment information in the ATO’s online services which they can access via their myGov account.
The ATO is advising employers to speak to their payroll software provider and find out how they will offer STP reporting, which may be through an update to their existing software or via an additional service.
If an employer or payroll software provider isn’t prepared to commence Single Touch Payroll Reporting, deferrals can be granted due to extenuating circumstances.