What is Single Touch Payroll Reporting, and does it affect you?

|by Linda Bergesen|Taxation and Compliance

Single Touch Payroll Reporting is a new legal requirement, and it ensures that all payroll related information is instantly reported to the Australian Taxation Office (ATO) each time a pay run is processed. This includes salaries & wages, pay as you go (PAYG) withholding and superannuation.

** Who it will affect **

Anyone who employs someone will be affected by this change at some point. If you have more than 20 employees on your payroll on 1 April 2018, you will be classified as a ‘Substantial employer’ and the law will apply from 1 July 2018. Anyone with fewer employees will have one more year to get ready.

This means that payroll software and service providers will need to make sure their products are in compliance with the new requirements in time.

** What it means for you as an employer **

Your current pay cycles will not change, only the way the information is reported to the ATO.

You will need a payroll solution that is compatible with Single Touch Payroll reporting. If you are unsure whether your current solution is appropriate, we can help you determine this, and if necessary, help you select the best system for your needs.

Your superannuation liability will be immediately reported to the ATO, and the ATO will be able to perform real time data matching to ensure that all obligations are met.

** Exemptions & Deferrals **

Those with unreliable internet connection due to a rural physical location may be eligible for an exemption. And employers who are defined as ‘Substantial employers‘ for only a part of the year may also be exempt from these requirements.

There are also circumstances that may warrant a deferral from these requirements, such as being affected by a natural disaster.

But this will not happen automatically, and it is important to follow the appropriate application process if you believe this could apply to you.

** What it means for you as an employee **

If your employer reports through Single Touch Payroll, more up-to-date information will be available in services such as myGov. This includes your year to date pay, any tax withheld and any superannuation contributions you are entitled to.

If you need any further clarification on the above, such as who to include in your head-count, when your payroll solution will be ready, or whether you may be entitled to an exemption, feel free to contact our friendly advisers for a chat.

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