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‘Single Touch Payroll’ on the horizon

The government announced on 28 December 2014 that they intend to simplify tax and superannuation reporting obligations through ‘Single Touch Payroll’.

Under Single Touch Payroll, employers’ accounting software will automatically report payroll information to the ATO when employees are paid.

This will eliminate the need for employers to report employee-related Pay As You Go Withholding (PAYGW) in their activity statements throughout the year, and employee payment summaries at the end of the year.

It will also streamline tax file number (TFN) declarations and Super Choice forms by providing a digital channel to simplify the process of bringing on new employees. It may also cut red tape by notifying super funds and government agencies, such as the Department of Human Services (DHS), when an employee ceases employment.

It is intended that Single Touch Payroll will be available from July 2016, with all employers “operating in a Single Touch Payroll environment” by 1 July 2019 (though exemptions may apply in exceptional circumstances).

Note that, to meet their obligations under Single Touch Payroll, employers would be required to use, and if necessary acquire, appropriate payroll software.

The government is yet to make final decisions on the implementation of this proposal, and is currently seeking submissions regarding issues such as transition arrangements and how to minimise implementation and compliance costs.

Want to know more? We’re here to answer your questions – contact us on (03) 8888 4000 or info@thepractice.com.au