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STP to ‘worsen compliance burden by 10 times’

Adam Zuchetti
Adam Zuchetti
10 May 2018 1 minute readShare
Red tape, tied, feet

The impending Single Touch Payroll system is continuing to court controversy, with one bookkeeper suggesting it will create a ten-fold increase in the compliance burden facing SMEs.

Of particular concern, according to BookBoost founder Don Grgic, is that businesses with a weekly payroll could be forced to see their bookkeeper or BAS agent every week to maintain compliance.

Speaking to My Business’ sister publication Accountants Daily, Mr Grgic claimed that rather than needing a business to sign documents five times annually — four quarterly BAS updates and a yearly payment summary — employers with 19 or less staff could be forced to provide another 52 signatures once STP comes into force from 1 July 2019.

“It’s a bureaucratic nightmare. Imagine trying to chase 52 signatures in a year,” he said.

“There are still businesses out there that are paper based. Not everyone is on the internet. Not everyone is running the latest software. That's really the issue.”

Mr Grgic suggested the ATO allow business owners to give their agent or bookkeeper authority to lodge on their behalf, under strict conditions, to remove this cumbersome burden.

“Bookkeepers or BAS agents are processing the payroll for their clients, on behalf of their employees. That means regular timesheets, and regular information from the client,” Mr Grgic said.

“Can't the ATO allow the client to give them a yearly authority to lodge on their behalf based on the information they've provided?”

Accountants and software providers have been at odds over what impacts SMEs can expect from the continued rollout of STP.

Sage vice president of customers for life, Simon Berglund, told My Business that concerns over STP are nothing more than “scaremongering”.

“When implemented and done properly, it will result in business reporting efficiencies, both for the business itself and for the employee with respect to getting an understanding of where their earnings are year-to-date,” he said.

Yet Diane Lucas of Direct Management suggested that businesses are resisting what they views as “a forced compliance … when they feel that they are compliant anyway.”

And the head of the Institute of Public Accountants, Andrew Conway, warned last October that businesses were unprepared for the change, which he believes will cause the greatest headaches for smaller businesses and sole traders.

The tax office has already warned employers with 20 or more staff to prepare to embrace STP from 1 July this year, with smaller employers to follow a year later.

STP to ‘worsen compliance burden by 10 times’
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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