Tiny minority of Australian employers ready for single touch payroll

Organisations with 20 or more employees must comply by 1 July 2018, but employers with less than 20 now need to follow suit a year later.

Just a small minority of Australian employers are ready for the shift to Single Touch Payroll Reporting (STPR) despite the fact that organisations with 20 employees or more only have until 1 July 2018 to comply, research has revealed.

A poll by Accountants Daily indicated that less than 10% of accountants believe their clients would currently be in a position to report tax and superannuation information to the Australian Tax Office (ATO) using the approach if asked to do so today.

STPR requires employers to report ordinary time earnings, salaries and wages, allowances, deductions, pensions and Pay-As-You-Go (PAYG) withholding information to the Commissioner in real-time every time they process payroll.

STPR reports will replace activity statements as the approved means of reporting PAYG withholding, and the ATO will fill in PAYG withholding levels on its business activity statements itself. This means that employers with large withholdings will no longer report PAYG on their activity statements.

The ATO also expects to provide employers with the option to pay their PAYG withholding when filing their STP reports. They will no longer be required to submit an annual PAYG report to the ATO.

But in order to comply, employers will need to purchase software that supports both standard business reporting and STPR. To do so may require them to upgrade – or in some cases, introduce an automated payroll system for the first time.

In September, the government confirmed that organisations with less than 20 staff would also be required to conform with STPR by 1 July 2019 as part of its push towards digitisation and its aim of penalising non-compliance with Superannuation Guarantee obligations.