From 1 July 2019, single touch payroll - the direct reporting of salary and wages, PAYG withholding and superannuation contribution information to the ATO - will apply to all employers. What employers need to report will also be extended to include certain salary sacrificed amounts.
If you have 20 or more employees you would already be using single touch payroll enabled software since 1 July 2018. This also includes payments made to the owners of the business in the form of salary, wages or directors fees.
If you have 1 - 4 employees, MYOB and Xero have announced new $10 per month offerings after the Tax Office asked software providers to provide no cost and low cost payroll options for micro employers.
For micro employers the Tax Office has said that a number of alternative options will be to allow your registered BAS Agent to report quarterly, rather than each time you run your payroll.
The Commissioner of Taxation released a statement indicating that small employers can actually start reporting through single touch payroll anytime from 1 July 2019 until 30 September 2019 with no penalties applied to mistakes, missed or late reports for the first year.
So, ifyou are in an area with no viable internet connection, such as some rural and remote regions, then exemptions may apply.
Do you have less then 20 employees?
You may need to upgrade your system or implement new ones.
When payments are made to your employees or superannuation funds, STP requires PAYG and superannuation contribution details to be reported to the ATO.
When it comes to PAYG withholding, employers will report details of salary and wages paid to employees as well as the PAYG withholding amount at the time the payment is made tothe employee. Employers have the option of paying the PAYG withholding liability at the same time, although this is not compulsory.
What needs to be reported:
- salary and wages
- director remuneration
- return to work payments to individuals
- employment termination payments (ETP's) - not compulsory if the employee has died
- unused leave payments
- parental leave pay
- payments to the office holders
- payments to religious practitioners
- superannuation contributions (at the time the payment is made to the fund)
- salary sacrificed amounts (from 1 July 2019.
Employers with poor super guarantee payment history outed
Underpayment or non-payment of superannuation guarantee (SG) is a big issue. New laws will enable the ATO to advise employees (or former employees) of their employer's poor SG payment and reporting history.
If an employee makes a complaint to the ATO, then the taxation officer is able to make a record or advise the employee about a failure or suspected failure by their employer or former employer to comply with their SG obligations. They can also share the Tax Commissioner's response to the complaint. So, if the Commissioner finds there is a problem with SG payments, they can disclose this information to the complainant.
Xero and MYOB Bookkeeper