Under the current STP regime, payroll information needs to be reported to the ATO through an electronic pathway. This is generally reported through your payroll software (e.g. Xero, QuickBooks Online etc). At this stage your gross wages and tax withheld components of each pay run transaction are reported, along with your year-to-date figures.
This is set to change during the 2021 Financial Year, with more payroll items being reported separately, for example allowances. This is due to the fact that the ATO are moving away from paper-based Payment Summaries/Group Certificates and heading towards electronic formats (currently in place for those already reporting via STP).
Read blog - Choosing the Best Business Accounting Software for You
A pay event is required to be reported to the ATO on or before the pay day. This is either the payment date stipulated in your payroll transaction, or the date you intend to make the payment to your employee’s bank account.
It is important that your payroll software has been setup correctly for STP reporting, which includes ensuring all employee records are up-to-date (e.g. TFN, date of birth, addresses etc). Reviewing these records prior to starting to report via STP is recommended.
An STP finalisation event is also required at the end of the financial year to notify the ATO of the final payroll information for your employees, being total gross wages and tax withheld. This is generally as simple as reviewing your payroll information and a few clicks of a button. Your employees will then be able to access their YTD & annual payroll information via their MyGov account.
With the introduction of STP and SuperStream, the ATO is more aware of payroll information than ever before. As a result, we have found that ATO compliance checks on Superannuation Guarantee (SG) are popping up more regularly than in previous years, especially with the end of the Superannuation Amnesty period in September 2020.
Staying on top of your SG obligations should be at the top of your list for employer obligations. Late SG payments for your employees will result in the need to lodge a Super Guarantee Charge (SGC) statement with the ATO, pay admin and interest charges, and the payments are not tax deductible.
A timely reminder that SG is due to be paid 28 days after the end of each quarter. The below table outlines the relevant quarters and the due date for payment.
|
SG Quarter |
Payment Due Date |
|
1 July – 30 September |
28 October |
|
1 October – 31 December |
28 January |
|
1 January – 31 March |
28 April |
|
1 April – 30 June |
28 July |
Find out how to proceed with implementing STP for your business or have those burning business questions answered by our team at BLG Business Advisers. Schedule in a chat with one of our Directors, with no obligation, to receive solutions to your challenges and discover if we’re the right fit for you.
Whatever you decide we wish you every success.