Approx time to read: Less than 4 minutes
Key Take Aways:
- Discusses the implementation of Single Touch Payroll (STP) through the eyes of a bookkeeper
- Valuable information for employers with less than 20 staff who are yet to implement STP due in July 2019
- If you have 20 or more employees you hopefully have this in hand, if not talk to your payroll dept.
- The conclusion -the whole process – if you are using STP enabled software – is as easy as clicking a button when the payrun is authorised.
The bookkeeping and accounting fraternity had known about it for quite some time before the first implementation date of 1/7/18 and there was a lot of murmuring and condemnation in my bookkeeping circles. What would this new reporting system really mean for anyone who processed a payroll and would it mean that a payroll was going to be more complicated than it already was.
We’d just gotten through the new legislation of SuperStream and got it under our belts still with a lot of queries and misgivings about the Australian Taxation Office (ATO) and its capacity to manage such sophisticated monitoring systems. You see, our experience as BAS Agents with the ATO and technology wasn’t all beer and skittles. The agent portals were, and still are, quite dinosaur like compared to the slick cloud accounting that is now pretty much the basis of our existence.
Anywhere we congregated we muttered and cursed and didn’t believe for a minute that that ATO could actually get their act together and implement something so grand as STP by the date they had given.
What we probably didn’t know was that the software companies had been on board awhile and were quietly working on this implementation and we didn’t even notice. Well, who would know for sure but things started to heat up in the year leading up to the first implementation date of 1/7/18. That is, the concerns and worries and questions and confusion about what we were supposed to be doing became a key part of all our training, workshops and network meetings.
To explain what STP is, you should go to the ATO website https://www.ato.gov.au/Business/Single-Touch-Payroll/About-Single-Touch-Payroll/ for full information but in essence, it is a reporting system whereby employers are to report each payroll some basic information for each employee to the ATO.
The idea being that the ATO would have current information to check things like whether super was being paid on time or at all and it is meant to simplify wage earner’s income tax preparation. It would also remove the need for employers to issue payment summaries at the end of the financial year.
The first implementation date was for employers with 20 or more employees and there was a census held in April for anyone who thought they may have to comply. That census was the subject of a lot of discussion as well but in the end we all got through it and worked out where we stood. We also had the criteria sorted by then so that we knew what information was necessary in every employee file to be able to comply with the reporting process.
I have 2 clients who fell into the first implementation and have to report STP – one with a weekly payrun and one with a monthly payrun. Bookkeepers have some additional obligations such as gaining the correct authorisations to lodge but in essence, the whole process – if you are using STP enabled software – is as easy as clicking a button when the payrun is authorised.
For all the hype and misgivings we as bookkeepers had before we stared and some of the software issues about getting it started, it’s now a very simple part of the payroll process that I don’t even blink at any more.
So the good news is, that when the whole rest of the payroll world in Australia, have to start reporting and lodging STP – which they do as at 1/7/19, they don’t have to worry, it’s not very scary at all. Unless of course you don’t pay your employee’s super. Then you have a problem.
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