From the Desk of KLAS : The Xero Roadshow and an update on Single Touch Payroll
Xero Roadshow 2019: Going Digital
The theme of this year’s Roadshow was - the digital domino effect. “Digital should be seen less as a thing and more as a way of doing things” was the quote used on numerous occasions throughout the session. To me going digital isn’t a question of why but more a question of when? Xero’s vision is to provide an integrated digital experience and that’s exactly what was showcased at the roadshow. The list of apps that can be connected with Xero for seamless data transfer is extensive and they have every intention of continuing to grow that list. Going digital is making the world your oyster! Not only are there many benefits of going digital from a business’s perspective, but bodies such as the government are making it part of our legislation, for example Single Touch Payroll. For those that are already using Xero payroll you have the option to opt in to use Single Touch Payroll straight from your Xero file. Xero will also be launching low cost payroll options for smaller employers to comply with Single Touch Payroll reporting.
Single Touch Payroll (STP) – The Low Down
STP is the new streamlined method of reporting employee’s tax and super to the ATO each time a pay-run is processed. Information will be sent directly to the ATO either from payroll software or through a third party. Using STP means you don’t need to send annual payment summary reports and upload EMPDUPE files to the ATO.
A list of what will be reported as part of STP:
- Salary & Wages
- Allowances & Deductions
STP will not only allow the ATO to ensure that employers are meeting their compliance obligations but will also allow employees to see year to date data through their MyGov account.
Employers need to count the number of employees on their payroll as at 1 April 2018. Those with 20 or more employees should already be using STP reporting from 1 July 2018 unless a deferral was lodged.
Legislation is currently before parliament to extend STP reporting to employers whom have 19 employees or less. If legislation is passed, these employers will be expected to start using STP reporting from 1 July 2019.
If you aren’t already using payroll software, don’t worry! There will be a number of low cost STP reporting options available by 1 July 2019 to help smaller employers. Low-cost STP solutions such as simple payroll software, mobile phone apps and portals are currently being developed to assist smaller employers.
There will also be additional STP reporting options available for smaller employers such as allowing STP information to be reported quarterly rather than each pay run. There are also a number of cases in which we can apply for exemptions and deferrals, contact us for more details.
Do I think STP is necessary? I’m not a fan of doing things twice. STP will reduce administration and information duplication. Anything that provides the ability to streamline processes with convenience in the cloud gets a big tick from me!
Senior Accountant KLAS Business + Accounting