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From 1 July 2018, ATO has enforced a new legislation on the payroll reporting system. The new legislation requests business with 20 or more employees to use the Single Touch Payroll (STP) enabled software to report employees’ payroll information including superannuation. Business with less than 20 employees has to implement Single Touch Payroll system too by 1 July 2019 (this hasn’t been lawed yet). Under the new Single Touch Payroll reporting system, payroll information will be instantly sent to ATO at each pay run.
 
20 Employees Definition:
 
The number of employee needs to be counted on the date of 1 April every year for the 20 employees purpose. If the employer misses out the date, they still can back date to count the number of the employees as the date of 1 April.
 
Employees you should include into the headcount:
  • full-time employees
  • part-time employees
  • casual employees and seasonal workers who were on your payroll on 1 April and worked any time during March – there are exemptions to counting seasonal workers who were employed for a short time only
  • employees based overseas
  • any employee absent or on leave (paid or unpaid).
 
Employees you should not include into the headcount:
  • any employees who ceased work before 1 April
  • casual employees who did not work in March
  • independent contractors
  • staff provided by a third-party labour hire organisation
  • company directors
  • office holders
  • religious practitioners.
 
What it affects the employer:
  • Need to upgrade their payroll software to have the Single Touch Payroll function
  • No need to provide employees payment summary and submit PAYG withholding payment summary annual report to ATO
  • Automatically get the new employee tax file number and superannuation details through existing Single Touch Payroll reporting system
  • PAYG tax withheld information will be prefilled on the Business Activity Statement or Instalment Activity Statement.
 
What is affects the employee:
  • Can review the payroll information such as gross payment, PAYG withholding, super payment, etc instantly in Mygov account
  • May not receive the payment summary from employer anymore as it wll shows in Mygov account too
  • No need to provide tax file number and superannuation details to employer anymore.
 
The new Single Touch Payroll (STP) system is likely to affect all business. If you have any query in relates to the new payroll reporting system or need some professional to assist with the system implementation, please do not hesitate to contact Pitt Martin. We are located at the Sydney CBD. Our contact number is 02 92213345 and email connect@pittmartin.com.au.