Single Touch Payroll exemptions

on August 30, 2019 General with 0 comments

Single Touch Payroll (STP) reporting has been extended to include all businesses from 1 July 2019 and there are exemptions that employers need to be aware of.

Financial year exemptions:
Businesses may be exempt from reporting through STP for one or more financial years, or exempt from reporting certain payments. Insolvency practitioners for employers that are required to report through STP are not required to report through STP on their behalf in 2018-19. Administrators of long service leave or redundancy schemes, who don’t use STP-enabled payroll software to manage payments to members, are exempt from reporting those payments through STP for the 2018-19 and 2019-20 financial years. Employees’ tax and super information will still need to be reported through STP. Those who have a withholding payer number, because they are registered for PAYG withholding and are not entitled to an ABN, are exempt from
STP reporting for the 2018-19 and 2019-20 financial years.

There is no need to apply for exemptions or notify the ATO, although supporting records should be kept. Employers that are exempt from STP reporting for a particular financial year will  need to start STP reporting in the following year or apply for another exemption. With the exemption from STP is in place, employers must continue to comply with their existing PAYG withholding obligations.

Employee exemptions:
Some employers may be exempt from reporting payments made to employees through STP for the 2018-19 financial year. Payments made by employers with 19 or less employees to closely
held payees, such as directors and family members, are exempt from STP until 1 July 2020. Payments made to foreign employees will be exempt for the 2018-19 financial year if all of the following apply:

•• The employee is employed by an offshore entity.
•• The employee is seconded to Australia.
•• All or part of the employee’s base salary and other remuneration is paid by an offshore entity, and;
•• A shadow payroll arrangement for the employee is maintained.

You will need to report any employee that does not meet all the criteria listed above. For the financial year commencing 1 July 2019, the ATO is considering concessional reporting arrangements for these types of employees.

If you are wanting more information on how to get STP ready, refer to —> https://www.ato.gov.au/Business/Single-Touch-Payroll.

Alternatively you can give us a call us on 07 3103 8551 to speak to our friendly tax experts.