Businesses used to report their payroll information to the Australian Tax Office (ATO) once every year, but now businesses need to report this information to the ATO after each pay day.
Single Touch Payroll (STP) is a new way of reporting payroll information to the ATO.
Payroll information such as tax and superannuation information must be submitted using a solution that is ATO compliant payroll or accounting software that files payroll information to the ATO after each pay cycle.
By submitting payroll information through STP compliant ATO solution, following yearly financial reports will not be required:
• Payment Summary Annual Report: Total wages, PAYG and super contributions made by the business
• Employee Payment Summary: Total paid per employee including wages, taxes and super
So now businesses should let the ATO know when they’ve made their last pay run of the financial year for their employees and employees within the business can see payment summary information by logging on to their my.Gov.au portal.
How to become Single Touch Payroll (STP) compliant?
Businesses should ensure they comply to below each payday:
• Online payroll or accounting software or desktop payroll software they use should be STP compliant and should produce ATO-compliant reports and report to ATO on their behalf
• For businesses currently using MS excel, spreadsheets or books, they must find STP compliant digital report or software and submit to ATO