Single Touch Payroll
Single Touch Payroll (STP) is a new way of reporting tax and super information to the ATO. This information is sent to ATO either directly from your software, or through a third party – such as a sending service provider. It is now mandatory for all employers in Australia to adopt a compliant payroll solution from 1 July 2019.
When an organisation has opted in for STP, they’re no longer able to produce payment summaries. Instead, employees can access these through their MyGov accounts. You should only opt-in once you want to start filing using STP. Once you’ve opted in, you won’t be able to opt out again.
Watch: Get ready for STP
ETP payment summaries are treated the same as the normal payment summaries. Once opted into STP, these can no longer be produced, and employees will instead get this information through MyGov.
Xero is STP ready and available for anyone who wants to report salaries and wages, PAYG withholding and superannuation directly to the ATO with confidence and security.
Xero’s Payroll Only plan has all you need to manage your business effortlessly. It simplifies compliance, letting you file your salaries and wages, PAYG and Super details to the ATO in a matter of clicks.
What you need to know about STP
ATO systems will match the STP information to our employer and employee records.
Your employees will be able to see their year-to-date tax and super information in ATO online services, which can only be accessed through myGov. Their data is updated every time you report (each payday for most employers). Without STP reporting, employee data is only reported at the end of the financial year.
If you make mistakes in your STP report, you can correct it in your following report. ATO won’t penalise you for making mistakes you correct.
At the end of the financial year, you’ll need to finalise your STP data. This is a declaration to the Commissioner to state you have completed your reporting for the financial year.
You will no longer have to give your employees a payment summary for the information you’ve reported and finalised through STP. Once you finalise your data, your employees or their registered agent will be able to lodge their income tax return using the STP information available in ATO online.
You will no longer need to provide us with a payment summary annual report (PSAR) at the end of the financial year for the payments you report through STP.
From 2020 ATO will pre-fill activity statement labels W1 and W2 for small and medium withholders with the information you report to us through STP. If you currently lodge an activity statement, you will continue to do so.
- About Single Touch Payroll, ATO, accessed 05 June 2019, Website Link
- Single Touch Payroll in Xero, Xero, accessed 05 June 2019, Website Link
Please contact us should you wish to discuss any of the issues raised above.