Time is running out for small businesses to update the way they report their gross wages and superannuation information to the Australian Taxation Office.
Single Touch Payroll (STP) came into effect for small business on July 1 this year, but the ATO has extended its implementation until September 30.
That means businesses with 19 employees or less should get into gear now to ensure they are STP compliant.
The transition could be relatively smooth if your business already uses STP-ready payroll software, so it’s important to contact your tax professional who can advise you on how to proceed.
Once set up, the software will enable you to easily send the required data to the ATO every time your employees are paid.
For those businesses that don’t have access to this software, the professional team at MWM Advisory can get you up to speed on what alternatives are available for your business to adhere to the new rules.
It is also important to note, that employers with more than 20 employees should already be reporting STP. If not, you will need to ensure that your business is in compliance with these changes as soon as possible. This is the second year and larger employers should have already opted in last year.
The good news is that the ATO has taken a pragmatic approach to implementing STP by offering generous concessions to eligible businesses.
Getting your business STP ready
Micro-employers, those with between one and four employees, are among those that may need more time to lock into the real-time pay-day reporting regime. So, the ATO is allowing these businesses to report quarterly until June 30, 2021, but only through their registered tax or BAS agent.
It’s important to note that to be eligible for this concession your tax agent must apply on your behalf by September 30 this year.
Concessions also apply if you employ family members or other ‘closely held’ payees who are deemed to be not at arm’s length.
Employers will need to bring these workers into the STP system from July 1, 2020, although they will have the option of reporting their information quarterly from that date.
There are also concessions for seasonal employers, or those who don’t have any employees for most of the year. This can include businesses that employ 20 workers or more for a maximum of three months of the year.
With the deadline looming fast, it’s important for business owners to determine where they stand with their STP reporting obligations as soon as possible.
MWM Advisory has been working closely with clients to ensure they get the full benefit of any concessions available to them.
For further information, contact an MWM Advisory team member at mwmadvisory.com.au/contact or phone 5596 9070.