Single Touch Payroll for Employers

From 1 July 2018, the Australian Taxation Office (ATO) will begin to implement ‘Single Touch Payroll’, which aims to streamline payroll reporting for employers and simplifying access to payroll information for employees.

This change in reporting payroll means that data including salaries, wages, PAYG installments and super are reported directly to the ATO via your current payroll (accounting) software. The ATO is working closely with accounting software providers (MYOB, Xero etc.) to have this running before July 1st, so you can expect to receive correspondence within the coming months regarding updates or steps to enable Single Touch Payroll.

Reporting to the ATO will happen in the background in a similar way superannuation data feeds directly to the ATO when you run your payroll using software packages such as MYOB and Xero.

When do you as an employer need to get ready?

• If you have 20 or more employees as at the 1st of April, you will need to report through Single Touch Payroll by 1 July, 2018.
• If you have 19 or fewer employees as at the 1st of April, you will need to report through Single Touch Payroll by 1 July 2019. 

What does it mean for you?

If you are an employer, from 1 July, you will begin to report through Single Touch Payroll, meaning you will send payroll and super information directly to the ATO using your payroll (accounting) software.

You will not need to alter or change your payroll cycle, simply report via Single Touch Payroll on the first payroll day after 1 July.

PAYG withholdings and super contributions will not change. As an employer you may no longer be required to provide payment summaries to employees, the ATO will generate and provide this data to all employees via MyGov.

If you are an employee, from 1 July, employers may no longer be required to provide payment summaries to you. Instead, you will access this via your MyGov account, where you can access year to date tax and super information.

What next?

First of all, if you’re an employer:

1. Count the number of employees you have as at 1st April to determine your date of compliance.  This is a self-assessment and is not required to be reported to the ATO.
2. Your software provider may contact you regarding Single Touch Payroll and the steps required to accommodate for the update. If you are unsure whether your software provider will be compliant for Single Touch Payroll it is advisable to contact them to determine the compliance status of the software. The ATO have advised that if your current payroll solution does not offer Single Touch Payroll, you may need to update your payroll solution or select an appropriate one if you haven’t already.

If you have any queries or questions regarding your current payroll solution or are unsure about selecting the right payroll solution for you, please do not hesitate to contact us.