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Single Touch Payroll

The Australian Taxation Office (ATO) continues to work toward the introduction of Single Touch Payroll which in general terms mandates employers send payroll information to the ATO with every payrun. Arrow Research Corporation (ARC) have actively been involved in ATO consultations with the software industry and will be working toward facilitating Single Touch Payroll by the July 2018 deadline.

Throughout the next 12 months we will continue to keep you informed on the project status, in the interim listed below are key dates and points.

Key Dates:
  • 1st July 2018 - Employers with 20 or more employees will be required to submit payroll information after every payrun.
  • 1st July 2019 and beyond - Employers with less than 20 employees may be required to conform to the legislation.

*A decision on whether to mandate small employers with less than 20 employees will be subject to further decisions by government before the end of 2017.

Key Points:
  • The requirement is based on reporting only - there is no requirement to pay employee withholding tax and superannuation any earlier than currently legislated.
  • Transitional relief clauses exist to prevent any employer from being penalised for non-compliance within the first 12 months of reporting requirements.
  • The lodgement of the payroll information will require an AUSkey so any business yet to obtain an AUSkey should contact the Australian Business Register to register for a key.
  • A small $100 tax offset may be available in the 2017/2018 financial year to some businesses with less than 2 million in turnover for expenditure on Single Touch Enabled software
  • The tax office may grant exemptions to businesses with fluctuating employee numbers or those with unreliable or non-existent internet connections
  • Employers complying with the STP reporting obligations for an income year will not need to comply with annual payment summary reporting.

The Single Touch Payroll legislation only allows for the transmitting of data to the ATO via digital data transfer mechanisms.ARC will engage a Digital Service Provider to perform the data transformation and submission services as the best and most cost effective way of complying with the legislation.

The ATO Digital Service Provider transforms the data output from Tencia/Arrow Financials payroll into the format specified by the ATO. The Employers AUSkey is then included with the message and transmitted to the ATO on behalf of the Employer.

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