Single Touch Payroll (STP) is a new way of reporting tax and super information to the ATO.The information is sent to ATO either directly from your software, or through a third party – such as a sending service provider. From 1st of July 2019, all small businesses would be required to be registered for STP.
Small businesses can contact they accounting software companies to find out how to register for STP. Major accounting software, such as MYOB, Quickbooks, Reckon, and Xero are all compliant with STP. There are number of payroll software in the market that also provides a free STP payroll system so that small businesses can utilize these functions without incurring hefty cost.
Small businesses do not need to change how and when they pay the employees. Every time a pay period is processed, the information goes directly to ATO. Therefore, 30th of June 2020, there will be no need to prepare end of the year payment summaries as the information will be reported throughout the year.
The new measure is a step forward to better compliance and for ATO to cross check the payroll and super information to ensure small businesses are accounting it correctly.
So are you ready for STP?