Only half of SMEs ready for Payday Filing
01 Apr 2019
Just days before one of the most significant changes to the payroll compliance regime in recent years, only 51% of local SME employers say they are ready for payday filing.
A year after it was introduced on a voluntary basis, payday filing will become compulsory for all employers on 1 April. From Monday, employers must file employee information every payday, provide new and departing employees’ address information to Inland Revenue (IR) and file electronically if their business’ annual PAYE/ESCT is over $50,000.
As part of the latest MYOB Business Monitor research, Colmar Brunton interviewed over 400 employers on their preparations for payday filing. Despite the looming deadline, 21% of SME employers said their business isn’t ready for the introduction of payday filing and 28% didn’t know if their business would be compliant with the changes.
After a short grace period to allow the changes to bed in, IR can fine employers if they file their payday information late, three times in a row.
MYOB Country Manager, Ingrid Cronin-Knight said it’s concerning that so many businesses are not ready for payday filing.
“Any major change can add to the stress business owners face when managing their compliance responsibilities – and unfortunately that can mean some put off dealing with them until they absolutely have to,” she said.
“Although this is a significant change for employers, it provides the opportunity to incorporate PAYE reporting into the pay run process, removing the need to separately file employee information on the 20th of the month.
“It is also important for employees because the new system will provide IR near real-time information, which means they can respond almost instantly when an individual’s situation changes in relation to Working for Families entitlements, student loan repayments or KiwiSaver contributions.”
According to the Business Monitor, almost a quarter (22%) of business operators find meeting their tax compliance obligations a significant pressure.
However, as IR undertakes its Transformation Project, which focuses on simplifying and streamlining the tax system and providing new digital services, more business owners are seeing the benefits of using technology to manage compliance.
Almost two thirds (61%) of SME operators in the latest MYOB Business Monitor survey agreed that technology is making it easier to manage taxation and payroll compliance obligations, while only 6% disagreed.
Ms Cronin-Knight said businesses that aren’t currently using payroll software are most likely to find it a struggle to meet the new payday filing requirements.
With one-in-three New Zealanders now paid through MYOB software, the company has comprehensively updated its suite of payroll products to prepare for payday filing.
“But as the latest MYOB Business Monitor survey highlights, there are many businesses that still need help to get ready. That’s why we’ve been working hard to draw attention to the change, helping accountants and business advisers prepare their clients and providing additional resources for employers to understand their responsibilities,” said Ms Cronin-Knight.
“With payday filing just around the corner, its clear the industry will be doing a lot of work to bring all employers up to speed in the next few weeks. Using online accounting and payroll solutions such as MYOB Essentials is an easy way to streamline the process as it completes payday filing at the click of a button.”
To help employers get ready for payday filing, MYOB has created a free online checklist, available for download at: myob.com/nz/comms/business/payday-filing
For further comment or other information please contact:
Rebecca Huang, MYOB NZ Public Relations Consultant
M: 021 112 2720 / E: email@example.com
Gerard Blank, The Agency Communications Limited Director
P: 03 341 5841 / M: 0275 243 629 / E: firstname.lastname@example.org
MYOB (ASX: MYO) is a leading cloud based business management solutions provider. It makes business life easier for approximately 1.2 million businesses across Australia and New Zealand by simplifying accounting, payroll, tax, practice management, CRM, websites, job costing, inventory and more. MYOB provides ongoing support via many client service channels including a network of over 40,000 accountants, bookkeepers and other consultants. It is committed to ongoing innovation, particularly in cloud computing solutions, and in 2015 was awarded the BRW award for the most innovative large company for 500+ employees and placed 2nd in BRW’s Most Innovative Companies Award list across all categories nationally. For more information, visit myob.co.nz or follow @MYOB on Twitter.
About the MYOB Business Monitor
The MYOB Business Monitor is a national survey of 1,000+ New Zealand small and medium business owners and managers, from sole traders to mid-sized companies, representing the major industry sectors. It has run since 2009, commissioned to independent market research firm Colmar Brunton. This most recent survey ran in February/March 2019. The Monitor researches business performance and attitudes in areas such as profitability, cash flow, pipeline, technology usage and the government. The weighting of respondents by both geographical location and sector is based on overall market proportions as established by Statistics New Zealand and is drawn from an independent survey group, which includes both MYOB clients and non-clients.