• Local Area Marketing

Many small businesses still to switch to new digital payroll reporting system


Last week, Australian small businesses with 19 employees or less, were required by law to report using the new digital Single Touch Payroll (STP) reporting system - but about a third are yet to start reporting or notify the ATO that they need more time to start.

STP requires employers to electronically send payroll information including wages, salary payments and superannuation to the Australian Taxation Office (ATO), at the same time as their usual pay run.

Many businesses can report from their existing accounting software if it’s STP-enabled but if its not, then with some preparation employers can implement the new payroll scheme with minimal interruption.

Chartered Accountants Australia and New Zealand (CA ANZ) said small businesses should make switch as soon as possible to avoid any unwanted calls from the ATO.

“According to the ATO, almost 400,000 small businesses have signed up to STP and around 100,000 have applied for quarterly reporting, been granted additional time to start reporting or are covered by the one year extension for closely held employees,” CA ANZ Tax Leader Michael Croker, said.

“Given there are around 750,000 small businesses in Australia that employ people, many are yet to make the move.

“Small business employers who haven’t signed up for STP, or have not obtained a deferral or concession, can expect to be contacted by the ATO.

"The ATO won’t just go from nice guy to tough guy, but the dial will move in a way that triggers more direct engagement."

Mr Croker said businesses who do not make the change an be penalised, but currently the ATO is identifying and working with businesses to help them adopt STP.

The intention of STP is to create transparency and guarantee employers are meeting their payroll obligations – particularly in relation to superannuation.

“This scheme gives the ATO access to businesses rea

l-time payments, meaning any underpaid entitlements, such as superannuation, will be identified,” Mr Croker said.

“Business who haven’t been meeting their employer payroll responsibilities can be identified and should expect to be contacted by the ATO.”

Businesses that have made innocent errors in their STP reporting can expect a light touch in this first year of reporting as the ATO has indicated that penalties will not be applied

“If your current payroll software hasn't been STP- enabled, or you don't use a payroll software, it’s a good idea to talk to your local Chartered Accountant about options that would best suit your business needs,” Mr Croker said.

For more information on how to set up STP for your business visit the ATO website:

https://www.ato.gov.au/Business/Single-Touch-Payroll/

#ATO #Tax #SMETax #SmallBusiness

© 2017-2020 Local Area Marketing