Single Touch Payroll – What ? Why ? When ? Who ? How ?

Mar 28, 2018

What is Single Touch Payroll – or STP for short?

It is a government initiative to simplify business-reporting obligations.

Single Touch Payroll is a reporting change for employers with 20 or more employees.

Employers will need to report payments such as salaries and wages, PAYG withholding and super information electronically through to the ATO directly from their payroll solutions at the same time they pay their employees.

This means that at the end of the financial year these employers won’t need to complete payment summaries for their employees as the payroll information would have been reported to the ATO in real time throughout the year.

Why is it being introduced?

Single Touch Payroll (STP), is being introduced by the ATO is an initiative to provide real-time visibility over the accuracy and timeliness of organisations’ payroll processes. STP proposes to streamline the administration of employee payroll, tax and superannuation obligations for employers.[1]

When does it start?

It starts from 1 July 2018 for employers with 20 or more employees, as at 1 April 2018.

Single Touch Payroll will be expanded to include employers with 19 or less employees from 1 July 2019, subject to legislation being passed in parliament.

Who needs to comply?

All employers who have 20 or more employees as of 1 April 2018 or is a member of a wholly-owned group with 20 or more employees across all the members of the group as of 1 April 2018.

Employees that are included and excluded in the Head count are:

How do you get ready?

  1. Count the employees who are on your payroll on 1 April 2018
  2. If you have 20 or more, your payroll software needs to be updated to start Single Touch Payroll reporting from 1 July 2018.
  3. The headcount on 1st April is a self-assessment. You do not need to notify the ATO of your employee numbers. 
  4. Check that your payroll software will be ready to offer Single Touch Payroll reporting from 1st July 2018. Some payroll software providers may have been given a deferral by the ATO if they have advised that they need more time. Talk to your registered tax or BAS agent about the best product to suit your needs. You can also ask your agent to report to the ATO through Single Touch Payroll on your behalf.
  5. Update your organisation and employee details, such as, Employee Id, Tax File Number, and Date of Birth, in your payroll software to ensure all data is available ready for 1st July start.

Headcount for ATO’s Single Touch Payroll is on Sunday 1st April – not sure what this means for your business? Contact us…….. Call Elke on 0410 819 783 or email hello@miebs.com.au

References and information:

Australian Taxation Office
ATO Single Touch Payroll Fact Sheet
ATO STP Checklist
XERO blog
MYOB – short video
[1] PWC Australia