Government figures indicate that Australian employers currently spend around $2.5 billion each year to meet their PAYG withholding obligations. To reduce the onerous administrative overhead costs spent on payroll and employee reporting, the Government has introduced Single Touch Payroll (STP) legislation.
In a nutshell, STP will require employers to utilise Standard Business Reporting (SBR) enabled software. SBR systems will automatically report employee salary or wage information to the ATO at the time they are paid. The good news is that all the major accounting and payroll software providers are either very close to being SBR compliant or have already attained that status. If you’re unsure of your accounting software’s capabilities, please contact our office for advice.
As from 1 July 2018 businesses with 20 or more employees will be required to report under STP. However, it is likely that employers will be able to utilise STP to report to the ATO from 1 July 2017.
So, how does STP work?
If your business utilises SBR enabled software not only will reporting be simpler, you will be able to access more straightforward processing of Tax File Number declarations and Super Choice forms, thereby simplifying new staff processing. Essentially, SBR enabled software will:
- Read data in your accounting system
- Pre-fill a range of forms
- Securely provide this information directly (and automatically) to the ATO.
By automating a lot of the processing, there will be less need for various monthly, quarterly and annual reporting. If you are uncertain about your business’ readiness to implement STP, or if you are not already using cloud accounting and automation software in your business, please contact us for help. We are cloud accounting software experts and can show you how to streamline administrative processes within your business. We are here to help 03 9746 6479.
