Hi and welcome to our third episode on kwikTV.
I’m Amy from Chan & Naylor Brisbane (Business Services) and I will be your host.
In this episode, we will be looking at the ATO’s introduction of a ‘single touch payroll’ system which will be mandatory for some employers from the 1st of July 2018.
So, enjoy this episode and do send us any questions whenever you like.
Hi Michael, can tell us a bit about the ‘single touch payroll’ system?
Under this system, employers will report payments such as salaries and wages, PAYG withholding and superannuation information directly to the ATO from their payroll system, at the same time as they pay their employees.
Single touch payroll will not change when superannuation and PAYG withholding is payable.
Single touch payroll will be mandatory from the 1st of July 2018 for ‘substantial employers’. These are employers with 20 or more employees.
It is expected that employers with 19 or fewer employees will be required to use single touch payroll from the 1st of July 2019, but this is still to be confirmed in legislation.
Tell us more about substantial employers and who would be regarded as an employee.
You will be a substantial employer if the headcount of your employees as at the 1st of April 2018 is 20 or more. Included in the definition of employees are:
- Full time employees
- Part time employees
- Casual employees on payroll on the 1st of April 2018 and who worked any time during March
- Employees based overseas
- Employees absent or on leave (paid or unpaid) and;
- Seasonal employees
Once you are determined as substantial or non-substantial, this definition is set regardless of later changes in staff numbers.
Can you please clarify who non-employers would be in this context?
Excluded in the definition of employees are:
- Employees who ceased work before 1 April 2018
- Casual employees who did not work in March 2018
- Independent contractors
- Staff provided by a third-party labour hire organisation
- Company directors
- Office holders and;
- Religious practitioners
What are the required actions when establishing a ‘single touch payroll’ system?
Determine the number of eligible employees as at the 1st of April 2018. To assist in this process, we suggest you ensure your payroll system is up to date, with any ceased employees being marked accordingly in your payroll system.
If you are a substantial employer, meaning you have upwards of 20 or more employees as at 1st of April 2018, you will need to ensure your payroll system is or will be single touch payroll compliant.
If you are not currently using a payroll system, or are using a system that is not intending to become compliant, you will need to move to a system that is going to be compliant. Don’t hesitate to speak to our team in regard to these changes. A list of suitable programs can be found on the Australian Business Software Industry Association website.
Well, we hope you enjoyed this episode on the ATO’s introduction of a ‘single touch payroll’ system.
If you have any queries or concerns about single touch payroll and your business, please contact Chan & Naylor Brisbane (Business Services) for more information.
That’s all for now! See you next time.
If you would like to know more about payroll and tax, you can click here to know more about Chan & Naylor services. You can leave your details here and Chan & Naylor Accountants in Brisbane can schedule you for a free consultation. We’ll contact you to explain more.
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