13 Feb Are you ready for Single Touch Payroll?
From 1st July 2019, all businesses will need to be reporting using Single Touch Payroll (STP). If you’re managing a business and you’re not sure what this is all about, you need to read on!
Single Touch Payroll means that every time you pay your workers, you need to send all wages, deductions and superannuation information to the Australian Tax Office (ATO) in real-time.
This may sound like a lot of work, but STP will remove the need for PAYG withholding activity statements across the year. STP reporting is generally done through accounting software platforms, and if it’s set up correctly it should lessen the time burden on business owners.
Although there are transitional options available for businesses that don’t use accounting software for payroll, the ATO has strongly implied that businesses should be implementing this technology if they have access to it.
Many medium-sized businesses already use accounting software. It’s not just useful for processing payroll and your quarterly BAS, it can also reduce your accounting costs, help you analyse your business and keep track of cashflow and profitability.
For very small businesses with few employees, particularly those that are starting up, it can be hard to justify the cost of a fully-fledged accounting platform. With the ATO’s encouragement, many accounting providers have released low-cost options suitable for these ‘micro-businesses’ to report with STP. The ATO has published a list of these providers, which includes the biggest players in MYOB and Xero.
This is an issue that business managers and owners need to get across well before the 1st of July deadline. To ensure you’re prepared, it’s worth raising the issue with us if you haven’t already done so.