From 1 July 2018, employers with 20 or more employees will be required to start reporting payroll and super information to the ATO using a Single Touch Payroll enabled payroll solution under law.
Single Touch Payroll is a government initiative to streamline business reporting obligations, where payroll information will be sent to the ATO from an employer’s payroll solution each time an employee is paid. This information includes salary or wages, pay as you go (PAYG) withholding and super guarantee amounts.
Salary or wage information and PAYG withholding amounts reported through Single Touch Payroll will also be pre-filled into the employer’s BAS.
Employers may also have the option to invite their employees to complete tax file number declarations and super standard choice forms online. Most information will be pre-filled and validated.
Employers who report through Single Touch Payroll will not have to provide employees with PAYG payment summaries at the end of the financial year, and also will not have to provide the ATO with an annual payment summary statement either. Employers will have to notify the ATO when the payment summary data is finalised, and the ATO will then make that information available to employees through myGov, and as pre-filled information in their tax return. Assistance will be provided to employees who have difficulty accessing information online by the ATO.
A payroll solution is the accounting software, business management program or payroll software used to run the payroll process. Payroll software will need to be updated to a version that supports Single Touch Payroll, and employers can begin to report through Single Touch Payroll from 1 July 2017 if their software is Single Touch Payroll enabled. The ATO are working with payroll solution providers to ensure their products are ready for Single Touch Payroll reporting.
In order to determine whether you are required to report through Single Touch Payroll, employers will need to do a headcount of their employees on 1 April 2018. For employers with 19 or less employees, your reporting obligations will not change. If you are required to report through Single Touch payroll and do not currently use a payroll solution, you will need to implement one by 1 July 2018 that enables Single Touch Payroll reporting.
How Single Touch Payroll will work
Employers, employees and tax professionals
For further information or to discuss how you may be impacted by these changes, please call to speak to Jodi Elder on 07 4638 1100, or visit the ATO website on www.ato.gov.au/singletouchpayroll.