Single Touch Payroll (STP), I had a few enquires today about it and questioning the advice sheet that we issued about when they need to be ready for STP. What is happening, I think is that all these salesmen for payroll and accounting systems are starting to push everyone to get their systems that they are giving my clients questionable and possibly misleading information.
The current situation is listed here.
- Large employers with 20 or more employees should now be reporting through STP, or have applied to us for a later start date.
- Small employers with 19 or less employees will need to report through STP any time before 30 September 2019 - this is a gradual transition, and not all employers will start reporting at the same time.
- If you're an employer with four or less employees you will have additional options."
If all your employees are family members, you actually can get more time still.
But overall most SMB organisations need to decide on how they will handle STP soon, but if you need more time the ATO will probably give it to you and what is right is that they have announced that there will be no penalties for mistakes, missed or late reports for the first year.
Unfortunately, the banks did decide *NOT* to get involved so now if you have not made any decision on how to handle STP, you need to look at the list of ATO approved solutions here.
Note although many of these say that they are free but actually in the details you will see they do have costs in the fine print. Looking through the list the only really free option that I liked was Payroller. Although I confess, I have never used it and have no idea how good it is.
Of the accounting packages, looking at this list that my clients use, Reckon I saw will now be $5 per month extra and MYOB will be $10 per month.
One big problem I do see with all of this is that in a large business, the payroll is done by the paymaster and the petty cash office does the disbursements (petty cash). In SMB these officers are the same people who prefer to do these together, so saving them time and money as its only one transaction. The problem with STP is that these disbursements will if done as now will show in the STP transfer, which is sure to cause issues with an ATO officer trying to reconcile the figures they are getting as they do not consider a disbursement a payroll item. The only solution is to split these payments up and do them separately, but that is going to cause more work and extra costs to the SMB business. I cannot see a solution to this with the way it is now. Whatever way you decide to go, you need to investigate this problem.
I hope this all helps.
Update: Some people pointed out to me that they are upset as they feel that the ATO is forcing small businesses to engage 3rd parties with extra costs. I know the problem as I have been using for many years a combination of an old payroll package and a spreadsheet that I programmed many years ago. These have worked just fine.
Well, there is nothing any of us can do, you now need to either download some phone app and manually entering the info or using a current payroll package that costs and will give you no benefit.