Hi and welcome to this brief video on Single Touch Payroll, I’m Naomi…
…and I’m David and we hope that this video will be able to help you to get started with single touch payroll or STP for short. One question we won’t be able to answer is why its called “single touch” payroll. That is still a mystery to me. If anyone is able to run their payroll with a single touch, please let us know as this would be very impressive. What we will try to cover is a brief introduction to STP for small businesses but remember each of your businesses is unique and will have its own specific requirements.
Yes, so if you do have any questions or queries please get in touch with us directly and we will be more than happy to help.
Single Touch Payroll (STP) is an initiative by the Government and is essentially digitising the payroll process for both employers and employees, in order to improve information flow to the ATO. Single touch payroll changes the way employers report on employee payments including salary and wages, PAYG withholding and superannuation.
STP sends tax and superannuation data directly to the ATO every payday, helping the tax office keep a closer eye on employers and protect workers from bosses who fail to pay super.
The most significant effect will be on superannuation reporting. Previously this was done annually via the PAYG summaries or group certificates. It will now be reported to the ATO with every pay day. Importantly, the way that PAYG withholdings, GST and super are paid to the ATO will not change.
It’s very simple once implemented. You will pay your employees as normal (weekly, fortnightly or monthly) and give them a payslip.
As your run your regular payroll, your STP-enabled payroll software sends a report directly to the ATO which includes required information such as salaries and wages, PAYG withholding and super
Yes absolutely and larger businesses – so those with 20 or more employees – will already have to be reporting using STP.
However, the ATO found that many small businesses were unprepared for STP and so has extended the deadline to 30 Sept 2019. What this date basically means is that if it is mid-September and you still haven’t organised your STP, you should apply to the ATO for an extension, or ask us to apply on your behalf.
I think the biggest benefit that will come from this for small businesses is that it will energise owners to make that upgrade to cloud based accounting software such as Xero or Myob accountright.
A recent survey commissioned by Intuit of over 500 small businesses found that converting to payroll software saved them more than 2 hours per week. The other functions of these systems can save even more time. One of my favourites is statements being emailed automatically to clients with overdue invoices.
Perhaps the biggest advantage of moving to cloud based bookkeeping software, is that we as tax agents and bookkeepers are able to access your file at any time, checking for errors or even doing your bookkeeping for you!
Additionally, you are no longer required to generate and distribute payment summaries to employees as this information will be available online via myGov.
Finally, you can on-board new employees quickly with online commencement forms including Tax File Number Declaration and SuperChoice.
You can report your Single Touch Payroll through a payroll or accounting software, registered tax or BAS agent who reports on your behalf or a low cost STP solution.
If you are using a large bookkeeping provider such as MYOB accountright or Xero, single touch payroll will be easy to set up and use. There will be a call to the ATO involved to register your software ID. Peter Vickers Business Group is also a MYOB and Xero partner so if you choose to use this software we can assist you with any queries you may have.
If the outlay for a cloud based subscription doesn’t fit in the current budget, there are many low and no cost options available. Our bookkeepers at PVA recommend Reckon as a provider for this. Reckon have a free mobile app that covers 1-4 employees, or unlimited employees for $5/month. Remember these solutions are payroll only. They don’t include other accounting functions.
Of course you can always pass on your bookkeeping and payroll duties to one of our bookkeepers at Peter Vickers Business Group and we can report on your behalf.
Great question Naomi, as we do this for a lot of our clients. There is very good news here. Owners of a business and their immediate family members are excluded from STP requirements. The ATO defines these employees as “Closely held payees”. You will be able to submit a PAYG summary at the end of the year after the accountant has determined the year’s profit and salary as per usual.
Yes, this will involve a call to the ATO, but again we are more than happy to help and liaise with the ATO on your behalf.
It’s the new digital way for business owners to run payroll. It sends a report directly to the ATO with information such as salaries, wages, PAYG withholding and super
That’s great thanks David. Well the good news is that there is plenty of support available to help employers get set up with single touch payroll. We at Peter Vickers Business Group have been helping our clients become STP compliant and ensure they have the correct systems in place. We also have bookkeepers who can help you get started with payroll and any other financial support you need, so you can focus on growing your business. It’s important to remember that each business is unique so there isn’t a one size fits all solution when it comes to payroll. We work with you to understand your specific business needs so please don’t hesitate to get in touch to speak to one of our bookkeeping or accounting experts.
If you’d like more information on how to grow your business, please contact one of our accounting and tax experts using the button below.
TALK TO US FOR THE RIGHT ADVICE
Chartered Accountants Liability Limited by a Scheme under the Professional Standards Legislation - AFSL 229302 | Peter Vickers & Associates Pty Ltd ACN 003466813 | Peter Vickers Insurance Brokers Pty Ltd AFSL 229302 ACL 229302
Peter Vickers Insurance Brokers is part of the Steadfast broker network.