Legislation passed on Tuesday 12 February 2019 now requires employers with 19 or less employees to use Single Touch Payroll-enabled software. This means that from 1 July 2019 you will be required to report your wages, superannuation and PAYG Withholding tax to the Australian Tax Office every pay cycle.
Employers with 20 or more employees should already be reporting under the new Single Touch Payroll rules.
Micro employers (i.e. employers with 1–4 employees) will have an initial option to allow their tax or BAS agent to report quarterly, rather than each pay cycle to help with the migration across. We note that this exemption has not yet been legislated but is referred to on the ATO’s website.
What will change?
- Each payday you will need to start reporting through ‘Single Touch Payroll’.
- Information on wages, superannuation and PAYG withholding taxes will need to be reported.
- Employees will now be able to see their year to date tax and superannuation information through myGov.
- You will not need to provide your employees with a Payment Summary or prepare Activity Statements at the end of each financial year. Unless you are a “micro employer” in which case you will continues to provide PAYG Payment Summaries and prepare Activity Statements.
What will not change?
- The payment due dates for PAYG withholding and superannuation guarantee payment obligations.
- Your business pay cycle does not need to change.
How do you get ready for Single Touch Payroll?
- Ensure your payroll software (i.e MYOB/Xero/Quickbooks) is updated for ‘Single Touch Payroll’
- If you do not have payroll software that is ‘Single Touch Payroll’ compatible then you will be required to upgrade your software to ensure that you comply with the ATO requirements.
Please contact our office on 03 9629 1433 if you require assistance for either Single Touch Payroll reporting or migrating to a cloud based compliant accounting software.