Single Touch Payroll Phase 2 is coming

If you’re paying a team of staff you’ve no doubt heard of Single Touch Payroll, we first learnt this term back in 2018 and were checking the payroll software we were using was compliant.

Put simply, Single Touch Payroll is a report that goes between your payroll system and the ATO each pay, and it shares some data with them about what your employee has been paid.

The Government’s plan was always to introduce this scheme in phases and the second phase will be introduced from 1 January 2022.

What’s changing?

Phase 2 of Single Touch Payroll will simply capture more information in that report including:

Tax File Number Declaration – you will no longer need to submit these forms separately to the ATO
Termination reasons – when paying someone when they leave you
Employment basis – are they Full Time, Part Time, Casual etc.
Payment categories – the types of payments you pay your employees will be further categorised to include salary packaging, working holiday makers, lump sum payments and more

What do I need to do?

The good news is your payroll software will do all the hard work for you. All you need to do is adjust your settings to ensure your STP reports are updated.

Even better news, some software companies have been granted a deferral so if you’re a user of these systems you have a little more time to get up to date:

MYOB users can take advantage of their deferral until 1 January 2023
Xero users can take advantage of their deferral until 31 December 2022

But why not take this time as a chance to review the data in your payroll system and ensure everything is up to date ahead of the new year, such as:

Employee contact details & emergency contact person
Details included on payslips – perhaps you’ve updated your logo or relocated
Ensuring settings are correct to exempt leave and superannuation accrual or PAYGW tax as appropriate for different payment types

If you would like support and advice navigating this, please get in touch. Wishing for a fabulous 2022 for you and your business!

#payroll #SingleTouchPayroll #Xero #MYOB

About Angela Gauci