Single Touch Payroll Deadline Switch Starts

01 October 2019

More than 450,000 Australian employers are now using Single Touch Payroll, with the deadline for switching now in effect (as at 30th September)

Ben Renshaw, Partner at BDO Australia commented:

“The ATO have done a reasonably good job of engaging with taxpayer organisations, payroll providers and professional services firms to advise, educate and seek feedback.

“In particular they’ve worked with payroll providers to help them develop low cost compliance payroll solutions, and they’ve engaged with the professionals to try and iron out wrinkles and uncertainty in the rules (e.g for expat employees).

“They’ve also been reasonable in granting extensions where necessary.

“Now they need to be clearer about how they will utilise the data and when more aggressive compliance programs will kick in. These will likely be driven by data analytics and automated reviews. Clearly, where a current year “issue” is identified using STP data, audit notices are likely to be produced for prior periods as well.

“The soon to be enacted Superannuation Guarantee Amnesty is an opportunity for employers to correct historical superannuation errors. STP is likely to highlight any errors which need amending.

“Once the Amnesty runs out – currently 6 months from royal ascent - the penalties for non-compliance with Super obligations become more severe and the ATO have less discretion.

“I’d anticipate that once the Amnesty has run its course we will see an increased focus on Super compliance activities driven by STP collected data.

“It’s worth noting that STP went live at 1 July 2018 for employers with 20 or more employees – albeit some were granted deferrals.

“I’d recommend that compliance activities begin with the larger taxpayers given they’ve had more time to work with STP. This will likely lead to bigger returns where issues are detected, and the effect of media (public) attention on larger taxpayers can act as a warning to smaller organisations.”

Read Ben’s comments in the Sydney Morning Herald.