Caution advised over STP roll-out
With Single Touch Payroll reporting now in force for all employers, legal teams need to be across how the ATO will seek to promote compliance from 1 October 2019.
Legal teams, as well as tax and BAS agents with clients that have yet to begin reporting through Single Touch Payroll (STP) will soon receive correspondence from the ATO, before it moves to directly contact employers.
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STP is now in force for businesses of all sizes, with 460,000 businesses now reporting, and just over 40,000 covered by a deferral, exemption or concessional reporting arrangement.
According to the latest figures from the Tax Office, 383,000 small businesses are now reporting through STP, out of the estimated 750,000 small business population.
Employers with five to 19 employees were more likely to be reporting through STP, with 66 per cent compliant, compared to micro businesses, with only 43 per cent compliant as of 27 September.
Substantial employers, or those with 20 or more employers, were required to begin STP reporting since 1 July 2018, and have achieved a 97 per cent compliance rate as of 27 September.
Despite the passing of the 30 September deadline, there will be no penalties for mistakes, missed or late reports for the 2019–20 financial year for small businesses, as the ATO adopts a facilitative approach in implementing the new law change.
Speaking to Corporate Counsel's sister publication Accountants Daily, ATO assistant commissioner Jason Lucchese reaffirmed the agency’s approach to helping employers transition to STP through “nudge correspondence”.
“The ATO recognises that 2019–20 is a transition year, and for employers that start reporting during that financial year, there will be no penalties applied for any late reports or mistakes in their reporting,” Mr Lucchese said.