Updated: Aug 29, 2019
You’ve probably seen Single Touch Payroll (STP) now and then in our communications, but what is it really?
We’ve all been informed that it’s an implementation that will change the way businesses report their pay as you go (PAYG) tax and superannuation information to the Australian Tax Office (ATO), but questions still prevail.
This article will hopefully answer all questions you have about STP and how we can help you.
What is STP?
Australia is finally following in the footsteps of other nations such as the UK in e-auditing. STP is a new digital way of reporting your tax and super, but in a specific format, with a different timeframe. Instead of reporting to the ATO at the end of every financial year, you’re now required to report through STP every payroll to the ATO.
What does this mean for employers?
It results in less hassle at the end of the financial year, and creates greater transparency for super payment for employees. It’s a more streamlined process that enables real time updates of payments for tax authorities.
It generates a greater emphasis on the accuracy of data as well as on the payroll process, as there is more visibility on the employer upon STP reporting.
It does mean that employers have to be ready for the change to be implemented by the 1st of July 2019, however. On the other hand, the first 12 months of STP reporting is a fully transitional period hence employers will not be penalised for failure to report on time.
Deferrals and exemptions that apply
A deferral is the postponement of the date an employer is supposed to comply with STP reporting. The ATO anticipates three types of deferrals:
1. Transitional deferral - where an employer will not be able to fulfil the requirements by the date set
2. Operational deferral - requests made in the course of STP reporting
3. Recurring deferral - requests made on a regular basis
If an employer is not able to meet the requirements by the date set, they will have to provide the ATO with a complete list of documentation as well as an STP implementation plan in order to be granted a deferral. The request will be granted based on a consideration of all factors.
An exemption on the other hand grants an entity freedom from the obligation of STP reporting for a period of time that can be open-ended or time-based. Exemptions are generally granted for a full financial year and may be due to:
1. Legislative instrument
2. Circumstances such as being based in an area with no/poor Internet connection
How PAQ can help streamline the process
This is where we come in.
With our capabilities we are able to help employers with STP set up, with minimal input from our clients. Just like that, your job becomes easier!
PAQ handles everything for you, from beginning to end, which frees up your time and allows you to focus on your business, without having to keep up with the STP implementation and the entire process of shifting your bookkeeping and auditing operations to accomodate it.
This way, you have absolutely nothing to worry about.
For a limited time only, PAQ Group will be doing a FREE PRE-STP REVIEW AUDIT to make sure you are compliant and ready for the upcoming changes. To find out more, contact us at firstname.lastname@example.org or call us at 02 6100 8600. Offers limited up to 30th June 2019.
Zarrah Morden is the Financial Minion at PAQ Group. The mission of PAQ Group is to create a stress-free bookkeeping experience and to empower entrepreneurs with financial know-how so they are able to create a more successful business. Join other entrepreneurs with the PAQ Newsletter to get regular insights on how you can grow both you and your business.