Single Touch Payroll (STP)

What is it?

• Single Touch Payroll (STP) changes the way employers report their employees’ tax and super information to us. As of 1^st July 2019, all businesses must report STP data to the ATO.

Using payroll or accounting software that offers STP, employers can send their employees’ tax and super information to us each time they run their payroll and pay their employees.

The information is sent to us either directly from the software or through a third party, such as a sending service provider.

There is a three-month transition period so you can start reporting any time from 1 July – 30 September.

The rules of reporting through Single Touch Payroll

Each time you send us your Single Touch Payroll (STP) report it will include minimum reporting requirements in order for you to meet your STP obligations.

Your updated software will capture the data we require. We have outlined these requirements below.

• You are required to report a pay event to the ATO on or before the pay day. The pay day is either the payment date stipulated in the electronic transaction to your financial institution or, if you did not stipulate a date for payment, the date you intend to make the payment into your employee’s bank account.
• If you include out-of-cycle payments in your regular pay event, report the date of your regular pay day.
• The report must include, at a minimum, each employee with an amount subject to withholding paid in that regular pay cycle. The report may include information for other employees.
• You must report the year-to-date values of gross salary or wages, allowances or other payments (as relevant), deductions and PAYG withholding for each employee included in that pay event.
  • These year-to-date amounts may be less than a previous report (for example, recovery of a current year overpayment).
  • These amounts can be zero, however, they cannot be negative.
• You must report year-to-date employer super liability or ordinary time earnings (OTE) amounts for each employee in that pay event.
  • If you pay above the minimum super guarantee (SG) liability, report this higher amount if you can’t separately identify these in your payroll solution.
  • If your year-to-date employer super liability is zero, report zero.
  • If your employee is a member of a defined benefit fund and you make super contributions for the employee, report this amount. Otherwise, report zero as the super liability amount. This would usually correspond to the year-to-date amount shown on the employee’s payslip.
  • Where you cannot report super liability you must report the year-to-date OTE amount.
  • You can report both OTE and employer superannuation liability if your payroll solution allows.
  • We will compare the amounts you report with information we receive from super funds. If we identify your contributions vary significantly from the liability reported, we will contact you.
• You must report period gross salary or wages (BAS label W1) and PAYG withholding (BAS label W2) for all employee payments included in that pay event.
  • These are your ’employer-level amounts’.
  • These amounts may be negative because of fixes you’ve made.
  • These amounts would generally correspond to the amounts you posted to your general ledger for the pay run.

 

• All payees must have either a tax file number (TFN) or Australian business number (ABN) reported.
  • Where you report a payment and withholding to a contractor under a voluntary agreement, you must provide the contractor’s ABN. The contractor’s TFN is not required. The reporting of these payments through STP is voluntary.
  • Where a TFN has not been provided you must use the TFN exemption codes.
  • A payee may be a contractor and employee with the same payroll ID within the same financial year. If so, the TFN and ABN must be reported if payments are made under both a voluntary agreement and any other gross payment.
• A pay event must contain at least one employee record.
• A pay event can only include one record per employee, per payroll ID.
  • If you establish two payroll records for an individual you can report these payments within the same pay event by using unique payroll identifiers. You must report separate year-to-date amounts for each unique payroll identifier for an employee.
• Where an employee is paid more than once on a particular day, you may provide a single report for that employee including the latest year-to-date figures (for example, updated year-to-date figures including all payments made for the day).
• You may lodge multiple pay event files for the same day. Your system will generate a time stamp which is used to identify the latest record for each employee to ensure the employee’s myGov display recognises the latest record

How?

Your payroll software like Xero and MYOB

What employees need to know

Once an employer starts reporting to us through Single Touch Payrol (STP), employees will be able to see their year-to-date tax and super information online. This will be available in myGov.

If employees use a tax agent, their agent will also have access to this information.

The year-to-date data employees see may not always align with the data in an employer’s payroll software – for example, when you report information that needs to be corrected in your next pay event.

It is not mandatory for employees to have a myGov account, however, if they want to access their information online throughout the year, they will need one.

It’s easy to create a myGov account, and there is online help available. Once it’s set up, employers can link their myGov account to a range of government services, including the ATO.

Read more about the services we offer STP