Single Touch Payroll for Small Employers - Viostream
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Single Touch Payroll
for
Small Employers
Single Touch Payroll Progress update
Progress update
114K+
Employers now reporting
7M+
information in
employees can see their STP
53K+ substantial employers
61K+ small employers Employee Commencement
services now deployed
Australian Taxation Office
Unclassified 3
Single Touch Payroll The approach for small employers
We co-designed
We consulted with a tax practitioner and industry representative group to explore practical solutions for helping small
and micro employers transition to STP - especially those with little or no digital capability.
The group targeted four needs associated with micro employers (1-4 employees) with low digital capability:
Low/no cost reporting solutions Simplified reporting requirements
($10 or less per month) (limited set of fields)
Transitional relief by way of deferrals Transitional relief by way of quarterly
and/or exemptions reporting until 30 June 2021.
.
Australian Taxation Office
Unclassified 5
Simple, low/no cost reporting solutions
The ATO called for expressions of interest from Digital Service Providers to develop appropriate low or
no cost payroll or reporting solutions.
The Criteria:
A low or no-cost A simple user ‘Minutes’ to An easily repeatable
solution ($10 or less experience complete per pay experience
per month for micro event
employers 1-4
employees)
Pain free set up Easy to access help Secure online Solution is provided
(especially at setup) environment as an ‘end-to-end’
service to the
employer
You can take a look at a product register by visiting ato.gov.au/stpsolutions
Australian Taxation Office 6
Unclassified
What we anticipate from small employers
Engagement with us about how and when an employer will implement STP.
This can be done by either:
Q
Starting to report now Asking for more time Where eligible, opting for
(before 30 September) (and then being ready to start quarterly reporting.
at a later date)
Small employers will need to start reporting or engage with us before 30
September 2019.
Australian Taxation Office 7
Unclassified
The ‘Start reporting now’ group
This will suit employers who:
have payroll solutions for their business and/or are
likely to see the value of getting STP done early
(minimal disruption and to get it out of the way)
It’s a mix of ‘early adopters’ and the ‘first to follow’ groups.
Key characteristics of this group:
Already use a payroll solution which is STP-enabled now
Alternatively, have a product which could be upgraded or
Are comfortable with ‘digital’ or
Are new to business and want to start out on the right foot.
Australian Taxation Office 8
Unclassified
The ‘I need more time’ group
Will comprise a mix of those who:
don’t have payroll software
are at the low end of digital capability or
meet certain special conditions
Some may only need a few more months to get things done.
Alternatively, they may need to overcome some significant obstacles.
Key characteristics of this group:
May be willing to use digital reporting, but want to see more results of others before implementing
May be a timing/mind-space issue within their business
May have little or no digital capability and will need help in taking the next step.
Australian Taxation Office
Unclassified 9
The ‘Quarterly reporting’ group
Q
This is generally only available to a:
micro employer with 1-4 or employees AND
is likely to struggle with implementing STP
STP report must be lodged by a registered agent through an STP-enabled solution (not
ATO portals).
Key characteristics of this group:
Micro employers who have little or no digital capability and will rely on a their agent to provide a
reporting solution in the medium term.
Australian Taxation Office 10
UnclassifiedATO messaging in 2019-20
Our messaging in Year 1 of the small business implementation will mainly be about encouraging engagement and
making a start to implement STP.
Jul-Sep 2019 Oct-Dec 2019 Jan-Mar 2020 Apr-Jun 2020
• Start reporting now • Prompts to those with • Prompts to those • Prompts to those with
• OR, ask for more deferrals expiring in with deferrals deferrals expiring in
time (via a deferral Oct-Dec expiring in Jan-Mar April-June
request) • Firmer messages to • Firmer messages to • And to those with
• OR, opt into quart- those not engaging those not engaging exemptions expiring
erly reporting (if or beyond deferral on 30 June
eligible) expiry • Warning letters re
Failure to Lodge expiry
All small employers need to either
to those not reporting
start reporting or engage with the ATO or covered by deferral
by 30 September
Australian Taxation Office 11
UnclassifiedATO messaging in 2020-21
Our messaging in Year 2 will shift towards potential application of penalties for those not engaging with the
ATO and preparing those on quarterly reporting for payday reporting.
First 6 months Second 6 months
Jul-Dec 2020 Jan-Jun 2021
• Support for employers who • Prompts to those on quarterly
need special help or assistance reporting (until 2021) to start
• Failure to Lodge penalty preparing for payday reporting
warning letters • Progressive application of
• Progressive application of penalties where warranted
penalties where warranted
All small employers need to be
reporting each pay day or quarterly by
Dec 2020*
Australian Taxation Office 12
*Unless they have approved exceptional circumstances UnclassifiedTimeline summary
All small employers need to either All small employers need to be
start reporting or engage with the ATO reporting each pay day or quarterly by
by 30 September * Dec 2020*
Year 1 Year 2 Year 3
2018-19 Small business 2019-20 2020-21
mandate begins
Small employer Small employer
voluntary opt-in reporting grows
FTL protection FTL protection
in place winds down
Deferral window, Limited exemptions
including exemptions continue
Australian Taxation Office 13
*Unless they have approved exceptional circumstances UnclassifiedSupport for registered agents
In mid-May, we provided all registered agents with a list showing your clients who lodged a Payment
summary annual report in 2017-18 and their STP status.
We recommend you use the list to segment your clients into one of the 3 groups –
1. The ‘start reporting’ now group
2. The ‘I need more time’ group
3. The ‘quarterly reporting’ group.
Where the ATO sees high proportions of deferrals (noting that practices will have different client mixes), we will
likely contact you to see how we can support you to get some of your clients reporting sooner.
Australian Taxation Office
Unclassified 14Practice profiles
Not every agent will be the same and so lodgment profiles will vary by practice and client mix
We also want to see staggering of implementation in advance of deferral dates so that bunching of start
dates does not occur on the last possible day
Proportion of clients by lodgment status and practice type
Example 1: Example 2: Example 3: Example 4:
Boutique, Large, national Medium Small book-keeper,
advisory based agent accounting practice BAS agent mostly manual
• Payroll ready (High) • Payroll ready (Significant) • Payroll ready (Low) • Payroll ready (Very low)
• More time (Low) • More time (Significant) • More time (High) • More time (Very high)
• Qtrly reporters (Very low) • Qtrly reporters (Low) • Qtrly reporters (High) • Qtrly reporters (Low)
Indicative scale: Low (10-20%), Significant (35-50%), High (60-80%)
Australian Taxation Office 15
UnclassifiedRegistered agent support package – coming soon
In late June, the ATO will release the first version of an integrated ‘Registered agent support
package’.
Based on your feedback, we will look to add to and improve v1.0 with further material in the months
that follow.
Small business pathways – Small employer readiness Small business
Decision tree tool readiness checklist guide to STP
Small employer and tax agent FAQs Micro Solutions Register (as A deferrals guide with links to the
webinar series (Small employer updated) deferral forms
focused)
Australian Taxation Office 16
UnclassifiedComplimentary supporting materials
We are making these presentation materials available to you.
In addition to what we’ve shared in today’s webcast, the materials will include extra information, slides
and content such as:
ATO messaging – what we will be saying to whom and when
Practice profiling
Links to important resources.
Australian Taxation Office
Unclassified 17Single Touch Payroll Quarterly reporting concession
Quarterly reporting – clearing a few things up
• CAN NOT be lodged on the BAS or • Must have between 1-4 employees
through ATO portals on the day of application.
• Must be lodged through an STP- • If employee numbers increase, the
enabled solution concession remains in place until
30 June 2021
Apply before
30 September 2019
• Available for micro employers who are • Agents need to apply by using:
reliant on their registered agent. online tool for single client requests or
• Available until 30 June 2021. • Registered agent bulk request form for
• STP report must be lodged by a multiple clients
Australian Taxation Office
registered agent Unclassified 19Quarterly reporting for seasonal or intermittent employers
Seasonal or intermittent employers may have no employees for most of the year and have an
increase in their employee numbers due to a seasonal workforce
(for example shearing or fruit picking)
Seasonal employers will be able to report quarterly and then notify us if they have no further
requirement to report for the rest of the year.
More on information on eligibility and how to apply is coming soon.
Australian Taxation Office
Unclassified 20Single Touch Payroll Closely held payee concession
Reporting closely held payees
We will support small employers with closely held payees to transition to STP by:
Q
• Exemption for closely held payees for • Quarterly pay event period for closely held
2019-20 financial year payees.
• Closely held payee reporting will need
to commence 1 July 2020.
Arms-length employees need to be
reported each pay day from
1 July 2019.
• Extended finalisation due date • We hosted topic based webinar closely held
(the due date of the income tax return for payees
the closely held payees). • To view the recording - ato.gov.au/stp > news,
events and resources.
Australian Taxation Office
Unclassified 22Single Touch Payroll Online deferrals and exemptions
Online deferrals and exemptions – single client requests
To access the tool:
Online services for agents – select Business then STP deferrals and exemptions
Tax or BAS Agent Portal – select Client's employer obligations then STP deferrals and exemptions.
• Most deferral requests will receive a response in real time
• Exemption requests will require evidence to be submitted
• We will contact you/your client if we need more information.
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Australian Taxation Office
UnclassifiedRegistered agents bulk request form
If you are a registered tax or BAS agent and you:
• will not be ready to report or
• need to submit a deferral request or quarterly reporting concession application on behalf of multiple clients (bulk request) you need to use
this form - attach the form via a mail message.
Australian Taxation Office 25
Please note – there’s a 28 day service standard UnclassifiedAvailable options in the online tool – single client requests
Transitional deferral Need additional time to start STP reporting
Already reporting in STP – but the employer is unable to report for a period of time due to extenuating
Operational deferral circumstances
Unable to regularly report every pay day - for example the employer regularly experiences internet
Recurring connectivity issues which means we might receive the report a couple of days after pay day
An exemption for reporting for one or more financial years – for example the employer is in an area with
X Exemption no internet connectivity
Already reporting in STP and the employer ceases to have a withholding obligation or might be registered
X No requirement to report for PAYGW but has no employees for a period of time
Q Small business quarterly reporting This is how to apply for the quarterly reporting concession – available to registered agents only
Tax Ready
Finalisation declaration deferral If an employer needs more time at the end of the financial year to make the finalisation declaration
Australian Taxation Office
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UnclassifiedSingle Touch Payroll Getting ready – practical tips
Preparing to lodge
There are a few steps to take as you prepare to start lodging :
STP role Cloud based software
Make sure you are linked to Notify us of your unique
report on your client’s behalf software ID (SSID)
Bulk request forms available: ato.gov.au/stp
Australian Taxation Office 28
UnclassifiedAuthority to lodge
If your client engages you to submit their STP report on their behalf you need to have the appropriate
authorisation:
• Per submission
• Has to be in writing or confirmation/tick-box
• Appropriate delegation has to be in place (internal process)
• Standing authority will not suffice *unless eligible for STP engagement authority
• Validation against Registered Agent Number
STP Engagement Authority
If the above is too onerous, one option would be to consider the STP Engagement Authority
• You can have an annual agreement with your client
• Subject to eligibility criteria
Australian Taxation Office 29
UnclassifiedSingle Touch Payroll Panel discussion
Single Touch Payroll Tax Time 2019
How will EOFY be different?
If employers normally reconcile at year end, they can still do that
Instead of providing a payment summary and lodging a Payment summary annual report, employers need
to submit a ‘Finalisation Declaration’ through an STP-enabled solution
If you commenced reporting this year, the due date for finalisation is 31 July.
Tax Ready
PLS
Employee can view their
Employer submits information in ATO Online ATO make information
finalisation declaration to services via myGov available in pre-fill
the ATO
Employers will need to provide a payment summary for any payments not reported through Single Touch Payroll i.e. employee share scheme.
Australian Taxation Office 32
UnclassifiedExample – income statement
Tax agents acting on behalf individuals will also have access to the income statement.
Menu path – Client in focus > Lodgments > Client Reports >Pre-generated reports – STP –View income statements
YearYear to date
to date
Income statement will display as “Year
to date” during the financial year
NotNot
tax ready
tax ready
Income statement will change to
“Not tax ready” on 1 July
Expand for Tax ready
more detail
Tax ready
Income statement will change to
“Tax ready” once the employer has made
the finalisation declaration.
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Australian Taxation Office
UnclassifiedAmending after finalisation
There may be situations when an employer is required to make an amendment after finalisation.
Tax ready
00 00 00
Where the need for an amendment is After the EOFY, amendments to
Employees income statement will be
identified, the employer has 14 days employee payroll information must
updated.
to report the amendment. be reported via an update event.
If the employee hasn’t lodged If the employee has lodged their If the employee has lodged their
their tax return: tax return and the amendment tax return and the amendment
their income statement will be results in a refund: results in additional tax payable:
updated in ATO Online with new we will amend the return and we will contact the employee.
“Tax ready” information. issue the refund.
Australian Taxation Office 34
UnclassifiedPre-fill reports
Below is a sample of a pre-fill report
Australian Taxation Office 35
UnclassifiedPre-fill reports
Unfinalised data
won’t be mapped
to an ITR label
INB STP finalised income statement
Australian Taxation Office 36
UnclassifiedTax time 2019 messaging
To:
Tax Employers Employees Payroll software Industry
Professionals providers Associations
Through:
Email or ATO ATO Newsletters Webinars and myGov inbox
Factsheets
letter website social video messages
Australian Taxation Office 37
UnclassifiedSingle Touch Payroll Resources and more information
Resources
Factsheets are available at ato.gov.au/stp – News, events and resources
Australian Taxation Office 39
UnclassifiedWhere to find out more
Topic based
ato.gov.au Articles
webinars
BMS
BMS
Speak with Speak with professional
Events
your provider associations
Australian Taxation Office 40
UnclassifiedYou can also read
