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STP to put spotlight on super contributions

STP to put spotlight on super contributions

While Single Touch Payroll has sparked debate about efficiency and cost of electronic payroll, it has been claimed employers that are late in paying super contributions will “stand out in real time”.

Ian Morante, head of SME specialist superannuation fund Nationwide Super, told My Business that business cash flows will come under greater scrutiny once the Single Touch Payroll (STP) reporting system is rolled out to small and microbusinesses by the Tax Office.

And the implications will be felt not just on tax, but Superannuation Guarantee payments will come firmly under the spotlight, he said.

“The fact that every single payroll that is processed from then will have that information on tax and super contributions etc going straight through to the ATO, and then the ATO being able to match up those super contributions with the records coming through from super funds, it’s really going to stand out in real time if an employer isn’t paying their super contributions to the fund on time and as they’ve stated,” he said.

“So cash flow management is going to be crucial for a lot of small businesses.”

According to Mr Morante, the “gamechanger” could actually prove beneficial for business operators, by forcing greater scrutiny of cash flows on a regular basis rather than coming up short when the super falls due.

“I think there are things that small business can do to help manage the changes that are coming up,” he said, citing a focus on service first and pricing accordingly, rather than being price driven, and invoicing promptly to reduce the lag on payment times.

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Mr Morante previously told My Business of the risks faced by business leaders forgoing paying themselves super to instead focus on building the business as their sole retirement asset.

STP to put spotlight on super contributions
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