1 April ‘headcount’ for Single Touch Payroll
From 1 July 2018, employers with 20 or more employees will be required to report their employees’ tax and super information to the ATO through payroll software that is Single Touch Payroll (STP) ready. Employers with 20 or more employees really need to take steps now to prepare for the requirement to use the STP system as the start date is approaching rapidly.
1 April 2018 is a key date because the number of employees at this date determines whether the employer will need to start using STP from 1 July 2018.
All employees generally need to be counted, this is not done on a full time equivalent basis. If an employer has 20 or more employee at 1 April 2018 they will be required to report to the ATO through STP even if employee numbers fall below 20, unless they apply for and are granted an exemption by the ATO.
There are some exceptions when undertaking the headcount at 1 April 2018. You do not need to include the following:
Casual employees who did not work in March
Independent contractors
Staff provided by a third-party labour hire firm
Directors
Employers with fewer than 20 employees have another year before STP is compulsory, although they can choose to start reporting through STP prior to 1 July 2019 if their software is updated.
In broad terms, STP aligns employer reporting obligations with their payroll processes (i.e. employers will report to the ATO each time they pay their employees).
Some issues for employers to consider include:
Some payroll software providers have asked the ATO for more time to update their products – employers will need to check if the product they use has a deferred start date;
The ATO has indicated that if an employer’s software will be ready by 1 July 2018 but the employer won't be ready, they will need to apply for their own deferred start date.
If you would like to discuss your options further, feel free to book a consultation
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