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Single Touch Payroll FAQs

Q: Will ADP® be Single Touch Payroll (STP) ready 1 July, 2018?

A: ADPs Payline and Payforce products will be STP compliant on 1 July, 2018. We have been working extensively with the ATO on the STP framework and this continues to evolve with the ATO to this date still confirming their requirements.

Q: What security file/IT systems are used by ADP to transmit the data to ATO?

A: Any data transmitted by ADP to the ATO will meet the ATO's operational framework requirements, including via a third party gateway.

Q: Is employee share scheme reporting going to change under STP?

A: Employee share reporting is not impacted by Single Touch Payroll. Employee share scheme data will still need to be sent at the end of the financial using the existing process.

Q: Will Individual tax variance be automatically uploaded and identified by the ATO to the payroll provider or will the ATO still send out letters and we need to let ADP know who has a tax variance?

A: PAYG variances are not part of the STP pay event data being transmitted to the ATO. PAYG variances will continue to be provided via existing methods.

Q: Does ADP have a STP Deferral Reference Number?

A: Yes, ADP has been issued a STP deferral by the ATO. This deferral has been submitted to cover all existing ADP clients during our transition.

The deferral date is 30 April, 2019 and the Deferral Reference Number (DRN) is 81 979 207.
To review a copy of the deferral notification letters, click on the product links below:

Q: How does ADP intend to handle return/response messages from the ATO i.e. data matching responses?

A: ADP will get responses from the ATO for every file that we send. For a success file transmission ADP will receive and ‘okay’ message, and for files that are incomplete a ‘with errors’ message. ADPs Payline and Payforce will each maintain a lodgement history that will show clients whether the file has been transmitted and lodged successfully or with errors.

Q: How do I determine if I am a substantial employer for STP commencement on 1 July, 2018?

A: Organisations need to conduct an employee headcount,on 1 April, 2018 to determine if they are a substantial employer. This is a count of all physical heads. It's not an FTE count. It doesn't matter if employees are casual, part-time or full time - if they worked in March 2018, they all count in this assessment.

Q: How do I conduct an employee headcount on 1 April, 2018?

A: On 1 April, 2018, you need to do an employee headcount. It is important to note, that this is not a count of your full time equivalents (FTE) only. There are a range of employee types that need to be included and excluded from your headcount. To ensure you consider all the relevant employee types, click here to refer directly to the ATOs definition.

Q: What if I am a substantial employer but then my employee numbers drop below 20 after 1 April, 2018?

A: On head count day, if you determine your organisation is a substantial employer you will continue reporting through Single Touch Payroll, even if your employee
numbers drop below 20 at a later date. Business can apply for an exclusion if they are seasonally based and have a large number of employees employed on 1 April 2018. To ensure you are clear on the details regarding exemptions, click here to refer directly to the ATOs definition.

Q: Am I eligible for an exemption from Single Touch Payroll reporting?

A: The ATO may grant an exemption from Single Touch Payroll reporting if:
  • your organisation is located in a rural area with no reliable internet,connection.
  • your organisation is classed as a substantial employer (20 or more employees) for a short period of the income year – for example, due to harvesting activities.

Source – Australian Tax Office web site, https://www.ato.gov.au/about-ato/about-us/in-detail/strategic-direction/streamlined-reporting-with-single-touch-payroll/?anchor=Employers1, cited, January 2018

Q: What if I don’t have a payroll solution?

A: If on 1 April, 2018 you determine your business is a substantial employer, you will need to update your payroll solution to enable reporting through Single Touch Payroll, commencing 1 July, 2018.

Q: What if my payroll solution is not Single Touch Payroll ready by 1 July, 2018?

A: If your software provider doesn’t support single touch payroll by July 1, 2018 and you employ 20 or more employees, you may need to look for another provider or apply directly to the ATO for a deferment.

Q: Will I still need to submit an annual payment summary report?

A: This is not required if final submissions are made using STP. As an employer, you still have the option of providing employees with a copy of their payment summary, if still necessary, but no additional reporting to the ATO required.

Q: Will I still need to generate payment summaries for my employees?

A: Under Single Touch Payroll reporting employers will no longer need to provide their employees with payment summaries. As an organisation, you can still nominate to produce payment summaries for your employees through your payroll provider. Employees can access their year to date payment summaries via their myGov account. Payment summaries, when viewed within the myGov portal, are now referred to by the ATO as ‘Employment Income Statements’.

Q: What is Single Touch Payroll?

A: Single Touch Payroll (STP) is an initiative by the,Australian Tax Office under the Federal Governments Digital by Default strategy. STP is a reporting change for employers. STP will mean that,employers will report salary, wages, PAYG withholding and superannuation,information through to the ATO at every pay event.

Q: What is myGov and how is it related to Single Touch Payroll?

A: MyGov provides employees with access to online government services. When an employer reports to the ATO via the Single Touch Payroll process, an employee
will have access to their up to date tax and superannuation information on their myGov account.

Q: Will the ATO be imposing penalties if I am not STP ready?

A: The ATO have stated that “During the first 12 months you report through Single Touch Payroll you will be exempt from an administrative penalty for failing to report on time. This is unless we have first given you written notice advising that a failure to report on time in the future may attract a penalty.” It is important to note that penalties may be incurred if late reporting is too frequent.

Source – Australian Tax Office web site, https://www.ato.gov.au/about-ato/about-us/in-detail/strategic-direction/streamlined-reporting-with-single-touch-payroll/?anchor=Employers1, cited, January 2018

Q: What are the benefits for an employer in moving to STP?

A: The main changes that will benefit an employer under STP are:
  • Business Activity Statement - for small and medium withholders, after 1 July, 2018, your payments (e.g. salaries and wages) and amounts withheld will be pre-filled on your business activity statement – labels W1 and W2. If you are a large withholder, after 1 July, 2018, you will not have to report PAYG withholding through your business activity statement.
  • New options for payment summaries - as an employer you may not need to provide your employees with payment summaries at the end of a financial year. Employees will be able to access their payment summaries direct through their myGov account. Employers can continue to provide electronic payment summaries to their employees, if that is their preferred business practice.
  • myGov - reporting via STP will allow your employees to access their year-to-date tax and superannuation information via their myGov account.
 

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