Small businesses have some big changes coming their way this July when it comes to reporting their finances to the Australian Taxation Office (ATO).
Single touch payroll (STP) isn’t new, having been mandatory for businesses with 20 or more employees since July 2018. As of this year, however, STP (also known as “one touch payroll”) will now be mandatory for all Australian employers regardless of their size.
What is STP?
With this new rule in place, employers are required to report wages and salaries, superannuation, and PAYG withholding to the ATO whenever you pay your employees (weekly or fortnightly). This effectively puts an end to reporting payments only once a year when the fiscal year comes to a close.
How Does this Benefit me?
While it may seem as if you’ll spend more time reporting to the ATO, STP can actually reduce the amount of stress and worry that comes with reporting.
• STP Can Save you Time
STP aligns your weekly or fortnightly wage and salary reporting with your PAYG withholding and business activity statement (BAS) obligations (both of which would previously need to complete either monthly or quarterly).
Because you’re regularly submitting your STP data, the ATO will also be able to pre-fill BAS and other forms on your behalf. This again can lead to substantial time savings.
• Fast Access to Financial Information
Employers and employees alike stand to benefit from STP because an individual’s financial information will be readily available online. Each time you hire a new employee, for example, you won’t need to manually collect employee information or provide end-of-year summaries since this information will be accessible through the MyGov portal.
Employees can also access the MyGov portal to view their financial details. They can see if their superannuation payments are up to date, something of which is particularly beneficial for part-time workers and students.
How to Prepare Yourself for these Changes
You don’t have to wait until July 2019 to be ready for STP. Start by speaking with an accomplished Xero certified Sunshine Coast bookkeeper at Efficiency Partners here in Brisbane!
We’ll show you how this low-cost financial reporting system can benefit your business as well as how a variety of other services like GST & BAS assistance, payroll management, and MYOB bookkeeping can help you stay focused on what’s most important – your business.
