Single Touch Payroll (STP) may feel like a very foreign and daunting process but if you follow the below steps, you’ll be reporting like a pro in no time.
There are two big questions to answer before you get started;
- How will you report through STP?
The answer to this question depends on the size of your business and if you are currently using a payroll/accounting software.
If you are using software then your first step is to speak to your provider to ensure they offer STP reporting.
If you aren’t using software to carry out your payroll then certainly speak to an industry professional to gain their recommendation on the right product for you. In our opinion, both industry leaders MYOB & Xero offer competitive packages for small users. It is important to note that MYOB Desktop software versions are not compatible with STP and you will need to upgrade to an online version.
- Will you have enough time before the deadline?
Employers with 20 or more employees should already be reporting through STP. If you are an employer with 19 or less employees and won’t be ready to start reporting before 30th September 2019 you will need to apply for a deferral. The ATO will have a new online tool to apply for deferrals available from April 2019.
Once you have addressed the above two questions the next step is to start preparing for STP:
Check your employee details
Check that the right people in your business (especially the person responsible for running your payroll) is aware of the upcoming change to your processes. STP will require that you have accurate information on your employees such as names, addresses, email addresses and date of birth. Now is also the time to ensure that you are:
- Paying your employees correctly
- Calculating employees’ super entitlements correctly
Decide who will send the STP reporting
You can choose to submit your own reports, however, if a BAS or Tax agent is sending them on your behalf you will need to record their RAN (Registered Agent Number) in the STP pay event settings (or they can do this for you if they have access to your company file). This information also needs to be recorded in your Access Manager.
Connecting your software to the ATO
Ask your payroll provider how your software will connect to the ATO, generally, this is by a Software Service ID (SSID), this is obtained when setting up Single Touch Payroll in the payroll software. The software ID will need to be added to your Access Manager and/or if you are using a BAS or Tax Agent to lodge the STP you will need to call the ATO and provide a one-off notification Ph. 1300 85 22 32 (you will need your ABN and the SSID and possibly your TFN number to do so)
Ready to report
You are now ready to report, we highly recommend not waiting for the deadline to commence reporting. Get in early and iron out any bugs before the deadline! Once you’ve sent your first pay run, check within your payroll software that the report was sent successfully to the ATO. Be sure to ask your software provider how they will alert you to any errors and the steps for correcting them.
For more information on Single Touch Payroll ATO reporting guidelines click here
If all of the above sounds far too challenging and time-consuming, you still have time to put your payroll in the hands of the professionals.
Contact us today to find out how we can help you.