Single Touch Payroll (STP) is set to change the way just over 100,000 employers report salary and wage payments to the ATO for about 13 million employees.
A further 700,000 employers may choose to voluntarily embrace this streamlined reporting standard.
Safe to say, this could be pretty big.
So what do you need to know before 1 July next year?
What is STP?
It’s a government initiative to simplify business-reporting obligations. Single Touch Payroll is a reporting change for employers with 20 or more employees.
Employers will need to report payments such as salaries and wages, PAYG withholding and super information electronically through to the ATO directly from their payroll solutions at the same time they pay their employees.
What does that mean, I hear you ask? It means at the end of the financial year these employers won’t need to complete payment summaries for their employees as the payroll information would have been reported to the ATO in real time throughout the year.
It means a raft of payments which needed to be done manually can now be done automatically.
STP will become mandatory for all employers with 20 or more employees. However, employers with fewer than 20 employees will also have the option to adopt STP if they so choose.
The official start date for STP is 1 July 2018.
1 July 2017
- Employers with 20 employees or more will be able to report to the ATO through Single Touch Payroll, however this is a non-compulsory phase, and is really designed for the ATO and software vendors to “pilot” systems. In this phase, the ATO and software vendors will nominate employers to participate in this phase, and as such, there is no driver for employers to use STP from this date.
- Employers with 19 employees or less will be able to report however, it is also a non-compulsory requirement for these employers to report using STP.
1 July 2018
- Employers with 20 employees or more will be required to report to the ATO through Single Touch Payroll. From this date, it is mandatory for businesses with 20+ employees to report using STP.
- Employers with 19 employees or less will be able to report however, it is non-compulsory requirement for these employers to report using STP. In due course, the ATO will provide updates to when employers with less 19 employees or less must report using STP.
How is MYOB planning for STP?
MYOB has been working closely with the ATO and other industry bodies in formulating how STP will work for all MYOB payroll applications. For Enterprise products, MYOB have nominated Advanced People to participate in the pilot phase with the ATO, starting from 1 July 2017. They will then roll out STP capabilities within Exo Payroll for the mandatory time frame of 1 July 2018.