The ATO has responded to a number of questions from My Business readers about Single Touch Payroll, including whether outstanding SG payments need to be caught up before the transition and whether penalties will apply for incorrect lodgement.
Following My Business’ recent webcast on the rollout of STP to employers with fewer than 20 staff from 1 July this year, viewers raised a number of questions and queries about their obligations as they transition to the new payroll reporting system.
We put these reader questions (listed below) to the ATO, with a spokesperson from the agency providing the following responses:
Do employers need to clear any outstanding superannuation guarantee (SG) payments before they begin STP reporting?
Employers have an obligation to come forward to report to us when they’re late or don’t pay their super guarantee (SG) obligations, regardless of the introduction of STP. We take non-compliance of SG obligations seriously and actively promote employees to report to non-payment of SG.
STP increases the ATO’s visibility of employer compliance with SG obligations, strengthening our ability to recover unpaid super.
Employers who think they have outstanding SG amounts should report those amounts via the superannuation guarantee charge (SGC) quarterly statements.
I need an extension. How do I apply for one?
We will grant deferrals to any small employer who requests additional time to start STP reporting. Employers can apply for a deferral online via the Business Portal or by calling the ATO.
The online application in some instances can give you an automatic approval including a deferral reference number for your records, depending on the time frame and reason you have selected.
Your registered agent can apply for a deferral through either the Tax or BAS Agent Portal or Online Services for Agents on your behalf.
Will I be penalised if I make a mistake with my first pay run?
There will be no penalties for mistakes, missed or late reports for the first year. We are working with employers to help them get it right.
(The ATO subsequently outlined how penalties will be applied for late STP lodgements once the 12-month transition period ends.)
Do you need to have a myGov account to be STP compliant?
MyGov is not mandatory; however, it is a great tool for employees to access the data that their employer is reporting through STP.
At the end of the financial year, employee can access their Income Statement via ATO Online through myGov. Otherwise, they can contact the ATO or their registered agent, who will also have access to it.
Is an AUSkey login needed to be STP compliant?
An employer may not need an AUSkey to be STP compliant; it depends on the type of STP-enabled solution you use. Some solutions that do not require the employer to have an AUSkey may include:
- Reporting through a sending service provider
- Reporting through software that uses the software providers AUSkey to connect to the ATO
- Stand-alone apps/internet-based solutions such as some of the solutions on the micro solutions register
If unsure, check with your software provider to find out if an AUSkey is needed.
Why was STP reporting not done in a similar fashion to the Small Business Super Clearing House?
The ATO will not be making available a portal or clearing house lodgement capability.
We approached industry via an Expression of Interest to make available a number of different solutions for small employers to use. The array of products is far better suited to a variety of business types, including apps, online portals and even full suites of payroll software for under $10 per month.
Who is exempt from STP reporting and how can employers go about securing an exemption?
You may be exempt from STP reporting if you meet any one of the following criteria:
- no or low digital capability
- no or unreliable internet
- irregular employment patterns
- other extenuating circumstances
You or your registered tax or BAS agent can apply for an exemption through one of the following:
- online via the Business Portal
- Tax or BAS Agent Portal
- Online Services for Agents
You can also phone us directly on 13 28 66 between 8am and 6pm, Monday to Friday.
What security measures are in place to cover the sensitive information being conveyed through STP reporting?
We take the security and privacy of employers’ information very seriously. We have steps in place to ensure data and online transactions with us are secure and safe.
We have specific security measures around where and how data is stored, accessed and transferred. We have [also] developed a set of security requirements for digital service providers to safeguard the integrity and security of the digital taxation and superannuation system.
The requirements for using our digital services vary for each digital service provider. They are based on the risk of the data they access, the number of users they have and the way they operate. It will be mandatory for users of cloud-based software to use multi-factor authentication.
The Operational Framework sets the rules for a provider looking to provide STP-enabled products or services (including end-to-end encryption of the data and multi-factor authentication) which they must build to. All STP-enabled products must undergo the ATO whitelisting process to ensure that they meet these requirements.
For more information about the transition to STP reporting and what it means for employers, download My Business’ Guide to the Single Touch Payroll system, and take another look at the webcast that was recorded live with a panel of experts, including the Tax Office’s STP project lead, John Shepherd.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
Ask the Experts: Business assets and liability after separation
By Anneka Frayne
Anxiety in the workplace
By Staff Reporter
Managing ‘sleeper issue’ of directors’ GST risks
By Jim Koutsokostas