In recent months there have been two major updates to Single Touch Payroll (STP) reporting requirements announced by the ATO.
Reduced deferrals and concessions from 1 July 2021
From 1 July 2021, the number of available concessions to delay STP reporting were significantly reduced.
Micro employers (4 or fewer employees)
The STP quarterly reporting concession for micro employers is now only available to those who meet certain eligibility requirements. It now includes the need for exceptional circumstances to exist.
Registered agents can apply for this concession on a client’s behalf through the online deferral tool.
Employers who have not started reporting through STP and do not have a deferral or exemption need to start reporting now.
Small employers – closely held (related) payees
Small employers were previously exempt from reporting amounts paid to closely held payees through STP until 30 June 2021.
Amounts paid to closely held payees from 1 July 2021 need to be reported through STP. If you’re a small employer (19 or fewer payees), you can report these amounts on or before each payday, or you can choose to report this information quarterly.
If you have any other payees (also known as arm’s length employees) they must be reported on or before each payday.
If you are an employer and not setup to for STP, please ensure you contact your adviser to either:
- Ensure a concession is granted (prior deferrals/concessions do not automatically apply post 30 June 2021); or
- Assist with implementing a STP-enabled system.
Expanding Single Touch Payroll (Phase 2)
The ATO have recently announced their expansion of STP reporting, known as ‘Phase 2’. This change starts 1 January 2022 and will change to the way employers report:
- amounts paid to staff – instead of reporting a single gross amount, you’ll separately show items such as overtime, paid leave, and bonuses and commissions
- income types – you’ll include information such as whether a payment is regular salary and wages or income for working holiday makers
- employment conditions – you’ll provide some additional information such as whether your employee is fulltime, part-time or casual and if they leave, the reason they stop working with you.
Whilst Phase 2 is not active until 1 January 2022, it is important to be ready for the changes in the lead up to the date, especially as it is during the busy holiday season.
Your STP-enabled software (i.e. MYOB, Xero, QuickBooks) will be updated by your software provider. When it is updated the software provider will let you know the next steps you should take, however please contact your adviser if you need further assistance.
Who to get in touch with