Single Touch Payroll: bringing payroll into the digital world
Angela Lehmann, CA ADP
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"STP will lead to transparency in payroll and level the playing field to ensure that all employers are meeting their employer obligations, along with other benefits."
Almost two years after Single Touch Payroll (STP) was first announced by the Federal Government as part of the Whole-of- Government "Digital by Default" agenda, the legislation has passed.
The STP legislation was enacted as part of the Budget Savings (Omnibus)Act 2016 No 55 (Cth) which received Royal Assent on 16 September 2016.
STP has had a number of iterations, initially intending to be both real time reporting and payment of Pay-as-you-go (PAYG) withholding per payroll event.
Needless to say, the Australian Taxation Office (ATO) and the government of the day had overwhelming feedback to say that employers did not support the concept of real-time payments and its impact on cash flow. Taking the feedback on board, the ATO has ensured that real-time payments are now only an optional feature.
The legislation has been fine-tuned due to the ATO's intensive consultation with the payroll, software, business and tax community stakeholders. As with any major transformation, there are likely to be teething issues, but ultimately there are benefits to be borne.
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