Single Touch Payroll (STP) is a new way of reporting your payroll information to the ATO.
From July 1st 2018, it is mandatory for Substantial Employers to report to the ATO using STP. A substantial employer is one that employs 20 or more employees, whether they be part time, full time or casual employees. To find out if you are a substantial employer, count the number of employees on your active employees list at April 1st 2018. If you have 20 or more employees, you must begin lodging STP as of July 1st 2018.
Any other employers may choose to report STP voluntarily after this date. However, the STP lodgement program is set to become compulsory for all employers on 1 July 2019, dependant on legislation being passed through Parliament.
Accounting software packages are currently busy writing modifications that allow you to lodge your STP obligations directly to the ATO from their program, much the same way you can now lodge Tax File Number Declarations for new employees.
Some software providers have been given an extension due to being unable to meet the deadline. If you are with these providers you need to contact the provider to find out when their start date has been deferred to, so you can be ready. If your software does not become compliant, you will need to contact your BAS or Tax Agent for more information about how to stay compliant. You may need to choose a new payroll software provider.
Once your software is compliant, you will be provided with information on how to lodge using your software online. Your software will upload your payroll data for each and every pay run directly to the ATO. The information will include any Wages, PAYG withholding, deductions, allowances, superannuation and all other items included in the payrun.
For the first 12 months of the program, there will be no penalties issued for employers that fail to lodge on time. However after this time there will be penalties imposed on employers that do not report their payroll to the ATO using STP.
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