Employers will need to be prepared for the new ATO reporting requirements for employee wages and superannuation that will start to be effective from 1 July 2018. Employees will be able to access far greater and timely information on their remuneration from the ATO and check that their employers are meeting their obligations.
Employers will need to use Single Touch Payroll-enabled software solutions to manage their payroll function, pay employees and adhere to the new ATO reporting requirements.
Under Single Touch Payroll, employers will need to report to the ATO on each payrun the following information for each employee:
- • Gross wages;
- • Allowances;
- • Deductions;
- • Other payments;
- • PAYG withholding tax; and
- • Superannuation.
This is in addition to the current obligations to lodge activity statements and annual PAYG payment summaries. You will need to ensure that the information on all of those forms matches up and any errors will need to be rectified within set timeframes to avoid penalties.
This will give the ATO greater visibility on your payroll and enable the ATO to contact employers who are not meeting their superannuation or activity statement obligations. Super Funds will in the future need to report employer contributions received by each member on a regular basis. The ATO will have a sizable database of information to identify non-compliant employers, especially with their superannuation obligations.
If you have 20 or more employees as of 1 April 2018, you will need to adhere to the new Single Touch Payroll reporting requirements from 1 July 2018.
For all other employers, the Single Touch Payroll requirements will start on 1 July 2019.
The ATO will start contacting employers with 15 or more employees from October 2017 in respect of these changes. The ATO is working with software providers to release Single Touch Payroll software and this should be available at the beginning of the 2018 calendar year.
Employees will be able to access their up-to-date tax and superannuation information through MyGov after 1 July 2018 if their employer uses Single Touch Payroll. You will be able to view year-to-date pay, PAYG tax withheld, and superannuation contributions that are liable to be paid on your behalf.
If you would like to learn more about these changes and put together an implementation plan to comply with the new ATO requirements, the team at EMspire Advisory can help. Feel free to contact us today!
Please note that this information is not specific and is general in nature and cannot be relied on as advice. Please contact us for advice specific to you and your circumstances.