Single Touch Payroll FAQs
Answers to questions about everything STP.
What is Single Touch Payroll?
You may have heard about Single Touch Payroll (STP) recently, but you may not know what it means. STP is a government initiative that requires all employers to report payroll information to the Australian Taxation Office (ATO). It involves electronically reporting your employees’ payroll information to the ATO each payroll cycle. STP is mandatory from 1 July 2019, and all Australian businesses are required to comply with it no later than 30 September 2019.
How does STP work?
Single Touch Payroll (STP) works by using the internet to submit information online via cloud accounting software. Employers can automate and streamline their processes, improve the accuracy of their accounting data and keep data up-to-date. They benefit from having quality and timely information at their disposal that will allow them to make better-informed business decisions. It’s a new, quicker and more simplified way of sharing important payroll information with the ATO.
- One-click compliance
- No more EOFY summaries
- Error-free payroll
- Employee access to payslips
What are the benefits of Single Touch Payroll (STP)?
One of the key benefits of Single Touch Payroll (STP) is that businesses won’t need to complete payment summaries and group certificates at the EOFY. STP software automatically sends your employees’ tax and superannuation information to the ATO.
STP makes things easier for employees, too. Their payroll information, such as salaries and wages, PAYG withholding and super, is readily available via their myGov account. They no longer have to wait until the end of the financial year to review what’s relevant to them.
When did Single Touch Payroll (STP) start?
The implementation of Single Touch Payroll (STP) began from 1 July 2018 for employers with 20 or more employees. It’s now mandatory from 1 July 2019 for Australian businesses of all sizes. If you’re an employer, you have until 30 September 2019 to comply. If your business is not yet using an MYOB STP ready product, MYOB makes compliance easy with simple, affordable STP payroll software. Explore our products to start using STP today.
What does Single Touch Payroll (STP) mean for me if I’m already with MYOB?
If you’ve already subscribed to a MYOB product that includes payroll, STP is a feature you can start using now. All you need to do is pay your employees as normal (weekly, fortnightly or monthly) and give them a payslip. Your STP-enabled payroll software sends a report directly to the ATO. Alternatively, if you use an accountant or bookkeeper to process payroll, they can set this up for you. Have a chat to them to ensure you’re compliant.
To find out more about STP, check the ATO's website.
Is STP free payroll software?
In most cases, no. There are not many Single Touch Payroll (STP) free software options. However, we understand that every business wants to avoid unnecessary costs. That’s why there are several low-cost STP software solutions available. The Australian government has partnered with software providers to offer businesses a range of affordable STP solutions with varying degrees of functionality, support and pricing models.
What low-cost STP options are there?
Free software for Single Touch Payroll (STP) is limited, but the good news is that you can take advantage of STP software with MYOB from just $5 a month*. Using our STP software only takes minutes to complete each pay period and don’t worry, there are no tricks to maintaining the program. It’s just simple, easy, quick reporting.
Does STP cost me money if I’m already a MYOB customer?
If you’re already a MYOB customer using MYOB Essentials or AccountRight, STP functionality is already part of your subscription and ready to go. Our MYOB Exo, MYOB Advances and MYOB Greentree enterprise products are also STP enabled. The best part is that there are no additional costs.
What if I’m new to payroll software?
Check out what STP payroll software products might suit you here on the MYOB website.
Does STP apply to my small business?
Yes – Single Touch Payroll (STP) does apply to your small business, if you have employees. In fact, all Australian businesses with a payroll function must use STP. It was implemented from 1 July 2018 for employers with 20 or more employees. From 1 July 2019 STP became mandatory for organisations of all sizes, including small business (even those with less than 4 employees). You must comply no later than 30 September 2019.
What does my small business need to know before I start using STP?
If your small business has more than 20 employees, you should already be reporting via Single Touch Payroll (STP). If you’re a small business with less than 19 employees, it’s time to get started with STP. To start reporting, first figure out whether you want to use software or use the services of an accountant of bookkeeper to help you. If you use payroll software which offers STP, you can update your product and start reporting at any time.
If you need more time to comply with STP, you can use our online form to apply for a deferred start date (see also: STP deferrals). You can even apply online for an exemption if you live in an area with intermittent or no internet connection. You can also opt for your accountant or bookkeeper to report your STP payment summaries quarterly, rather than each time you run payroll. This option will be available until 30 June 2021.
What does STP mean for accountants and bookkeepers?
Single Touch Payroll (STP) will impact over 100,000 employers and about 13 million employees. If you’re an accountant, it isn’t just a big change in reporting – it could change the conversation between you and your clients.
You may find that your clients take more ownership of their accounting data knowing that it was being transmitted to the ATO each pay run. This could mean that they no longer rely on you to fix their errors at the end of the year, leaving you with more time for planning. Which is something your clients are happy to pay for you to do, too!
Do I need to buy new software for STP reporting?
You only need to buy new Single Touch Payroll reporting software if you’re not currently using payroll software. If this is the case, you’ll need to sign up for an online STP software solution. You’re required to use compatible software to submit your report online with each pay cycle.
The ATO has partnered with software providers to offer businesses a range of affordable STP solutions with varying degrees of functionality, support and pricing models. Check out the ATO’s STP Software Register to find out what products are available, including open source payroll software.
Does MYOB come with STP reporting?
If you’re not a MYOB customer, we’re currently offering Australian businesses Single Touch Payroll (STP) reporting options from just $5 a month. And no, that's not a typo. Stay ATO compliant and complete your payroll tasks with 50% off for your first 3 months.
If you’re already a MYOB Essentials or MYOB AccountRight customer, you don’t need to buy new software to use STP. It’s a feature that’s included in your subscription, so it’s business as usual. Or, simply upgrade your MYOB software if you’re using a desktop version.
Do I need to connect to the internet for STP reporting?
Though you’ll need to submit your reports online, you can process your payroll offline (locally) and import payslips. Simply log in to your MYOB account and lodge your Single Touch Reporting (STP) to the ATO once you’re back online. Bear in mind that you’ll need an internet connection for the Pay Event to be processed successfully.
It’s important to note that you’re not required to move to the cloud if you upgrade to AccountRight 2018. This STP reporting solution has been designed to work locally, online or in network mode. Although STP is supported for AccountRight in both cloud and desktop modes, we recommend taking advantage of the cloud services. In doing so, you can benefit from features such as invoice tracking, online payments and the ability to work from multiple locations.
Where can I find a Single Touch Payroll checklist?
If you’re unsure about doing Single Touch Payroll (STP) on your own, don’t worry. The Australian Taxation Office (ATO) has published a handy STP checklist you can read before getting started. By reviewing this STP checklist before you send your first pay event report to the ATO, you give yourself a better chance of submitting files successfully.
For more detailed STP requirements, including what you need to report, how to make corrections and finalising your STP data you can also see ATO's STP employer reporting guidelines. For peace of mind, it’s worth noting that the first year is a transitional year and penalties may not apply.
How do I get ready for STP?
As mentioned in the Single Touch Payroll (STP) checklist, if you’re not already reporting STP, the first thing you need to do is determine how you’d like to report. For example, do you want to use STP payroll software? Or would you prefer a third party (such as as accountant of bookkeeper) lodge STP for you? The method you choose may depend on the size of your business.
The good news is that if you’re already a MYOB Essentials or MYOB AccountRight customer, STP is a feature that’s included in your subscription. Or, simply upgrade your MYOB software if you’re using a desktop version.
If you’re not already a MYOB customer, MYOB is offering Australian businesses this from just $5 a month. And no, that's not a typo. Stay ATO compliant and sign up now for 50% off for your first 3 months. Don’t forget to review that STP checklist, too!
How do I register for Single Touch Payroll (STP) with MYOB?
If you’re unsure how to register Single Touch Payroll (STP), how to set up STP, or how to install STP, don’t worry, MYOB is here to help. If you’re currently a MYOB Essentials or MYOB AccountRight customer, you don’t need to buy new software to use STP. It’s a feature that’s included in your subscription, so it’s business as usual. Or, simply upgrade your MYOB software if you’re using a desktop version.
Once you know you’re STP ready, you’ll need to connect to the Australian Taxation Office (ATO). The easiest way to submit your reports is by using the ATO’s Access Manager to enable MYOB. This requires you to have an AUSkey, or have your ABN connected to your myGov account. Alternatively, you can call the ATO for assistance
You can also follow these steps to link your account to the ATO:
1. Connect to the ATO
2. Submit payroll information
3. Nominate your business’ best contact person
4. Add clients to portal (only for accountants and bookkeepers – otherwise skip this step)
5. Notify the ATO you’re set up and ready to go!
6. Upon successful completion, you’ll see this window.
7. When you’re ready to submit reports each pay cycle, you’ll see screenshots such as these.
What if I want to use MYOB for STP but I’m not a MYOB customer?
If you’re an accountant or bookkeeper setting up STP on behalf of your client, you can set yourself up to report payroll information for their business. Complete the readiness check, connect to the ATO and start reporting. If your client wants to process their own pay run, they'll need to register themselves for STP before starting the pay run.
Please note if you or your client has processed a pay run but hadn’t registered their own business for STP, their reports won’t be accepted by the ATO.
What are my Single Touch Payroll (STP) requirements?
To fulfil Australian Taxation Office (ATO) Single Touch Payroll (STP) requirements, you must be compliant by 30 September 2019. If you’re not ready, you can apply for a deferral using this form.
Deferrals for STP requirements will be considered by the ATO under certain circumstances. You may be eligible for a deferral if your business:
· is transitioning to new STP software
· is using custom payroll software that needs to be configured and tested for STP
· has complex payroll software and needs extra time to transition to STP
· gone into administration or liquidation
· is experiencing circumstances outside of your control, such as a natural disaster.
If you can’t meet STP requirements, you’ll need to apply for a deferral. Follow the ATO guidelines and be sure to provide any evidence if it’s required. You can do this by:
· logging into the ATO’s Business Portal
· selecting ‘Manage employees’
· selecting ‘STP deferrals and exemptions’.
Are there any exemptions for STP requirements?
There is only one STP requirements exemption available and that’s for Australian businesses in areas there is no internet connection, or the connection or service is intermittent or unstable, which impacts your ability to report through STP.
If this applies to you, follow the steps to defer above. Alternatively, your accountant or bookkeeper can do this for you by logging into the ATO Agent Portal and selecting ‘Client's employer obligations’ then ‘STP deferrals or exemptions’.
When should I ask the ATO for a deferral for STP requirements?
If you know you’ll need to request a deferral, it’s best to the ATO know as soon as possible. They’ll work with you to discuss your current circumstances and may be able to offer you extra time to lodge your STP reports.
Remember, if you’re currently a MYOB Essentials or MYOB AccountRight customer, you don’t need to buy new software to use STP. It’s a feature that’s included in your subscription, so it’s business as usual. Or, simply upgrade your MYOB software if you’re using a desktop version.
What if I don’t comply with Single Touch Payroll (STP) legislation?
You must comply with Single Touch Payroll (STP) legislation by 30 September 2019. If not, you may face penalties from the Australian Taxation Office (ATO). In saying that, the ATO also understands that the first year (from 1 July 2019) is a transitional year for small businesses (employers with 19 or less staff), so depending on your situation, penalties may not always apply. Penalties for not complying with STP legislation will be evaluated on a case-by-base basis.
If you don’t think you’ll be ready to comply with STP legislation by the 30 September deadline, you may apply for a deferral.
You can also apply online for an exemption if you live in an area with intermittent or no internet connection. You will also have the option for your accountant or bookkeeper to report your STP information quarterly, rather than each time you run payroll. This option will be available until 30 June 2021.
What if I don’t want to register for STP?
Don’t worry, registering for STP is easy. Take a look at MYOB’s product comparison page to find out what products are available for STP. If you have an accountant or bookkeeper, you may also find it useful to ask for their advice about which MYOB product is best for your needs.
If you’re not already a MYOB customer, MYOB is offering Australian businesses an MYOB STP product from just $5 a month. And no, that's not a typo. Stay ATO compliant and complete your payroll tasks with 50% off for your first 3 months.
What happens if I submit incorrect Single Touch Payroll (STP) information to the ATO?
Sometimes it takes time to adjust to new software. Luckily, if you make a mistake filing information in your pay cycle you can fix it in your next pay run. If you submit incorrect Single Touch Payroll (STP) information to the Australian Taxation Office (ATO), you’re allowed to make corrections without penalty. But be aware that if you don’t fix your incorrect STP information before your next cycle (i.e. weekly, fortnightly or monthly), you may be penalised.
To make a correction, simply factor it into your next pay event report by editing the pay run. If significant errors have been made, you can request a full file replacement. This may only be used to replace the most recent pay event and shouldn’t be used for corrections.
According to the ATO, you can make corrections to the following information:
If you’ve submitted information to the ATO that doesn’t reflect the information in your payroll system, it needs to be fixed within 14 days or in the next pay event (if a permanent employee).
If you’ve overpaid an employee during the current financial year, they’ll only need to repay the net amount of the overpayment. This fix can be made in the next pay event or within 14 days of spotting the overpayment.
A misclassification is where information has been reported under an incorrect item. For instance, if you report a payment as income rather than as an allowance. You’ll be able to fix this error in your next pay event.
Reporting under an incorrect ABN or PAYG withholding branch
Once you’re aware that an employee has been reported under an incorrect ABN or PAYG, this must be changed immediately. Report your employee under the correct ABN or PAYG withholding branch from the point you discovered the error and adjust any incorrectly reported amounts from the incorrect ABN or PAYG branch. You can make these adjustments in the next pay event or using an update event. If the adjustment moves PAYG withholding amounts between ABNs or branches you may need to revise activity statements.
To find out more, you can read “Correcting a pay report” on the ATO website or reach out to our MYOB support team.
Where do I go if I don’t know what to do?
MYOB is here to help. Below we’ve listed some resources that you can review in your own time.
If you prefer, we welcome you to chat directly to somebody from the MYOB team. Contact us today.
If you’d like to do further research, you can speak to your accountant or bookkepper, or check out the ATO website.