What is tax planning? Essentially, tax planning is something you do to put your business into the best possible tax position. After all, nobody... Read more
Introducing Courtney May – intern from Altitude Advisory’s Chartered Accountant Achievers Program.
Courtney touches base on the Single Touch Payroll (STP) and how it will finalise its progressive roll out from 1 July 2019.
From 1 July 2019, STP will become mandatory for all employers, with the aim to streamline the reporting process and eliminate any potential reporting errors.
The implementation of STP is aimed to reduce the double handling that is currently involved. The ATO will then be able to pre-fill pay as you go (PAYG) sections of the business activity statement (BAS) which would also eliminate the need for employers to produce payment summaries to their employees.
From 1 July 2019, every time an employer pays their employees, they will be required to report the data to the ATO using STP compliant software. This software must be able to access the ATO database and produce Fair-Work compliant payslips along with process termination payments.
We will find that these new changes will predominately impact employers with less than 20 employees as opposed to the larger companies. However, any adverse effects have been addressed, with the Commissioner of Taxation, Chris Jordan, stating that there will certainly be an adjustment period for smaller businesses.
Employers with 1-4 employees will be graced with a transition period which allows their registered Tax Agent to report quarterly for the first two years and employers with 5-19 employees will be given until 30 September 2019 to submit live payday.
The ATO has offered to grant deferrals to any small employer who requests additional time stating that no penalties will be issued for mistakes, missed or late reports for the first year. Along with this, the ATO has been working with software companies to deliver low and no-cost reporting solutions for those currently without compliant software.
If you would like to ensure your business and software is compliant with the single touch payroll or for more information on the topic, click here to get in contact with one of our Advisers today.
Written by Courtney May
Chartered Accountant Achiever Program
Kerri Stutley, Tumby Bay Foodland
Phillip Cross, Royce Cross Agencies