The Minister for Small Business, Bruce Billson, and the Assistant Treasurer, Josh Frydenberg, have announced the Government will “cut red tape for employers by simplifying tax and superannuation reporting obligations” through a new service called Single Touch Payroll and the streamlining of TFN declarations and Super Choice forms.
Single Touch Payroll will mean employers no longer need to report employee Pay As You Go Withholding (PAYGW) amounts in activity statements or end of year payment summaries. Instead these amounts will be automatically reported to the ATO via accounting software when the employees are paid.
Single Touch Payroll is scheduled to be available from July 2016, following a consultation process. Presumably this will give software developers time to build the functionality into software packages using Standard Business Reporting.
Alongside Single Touch Payroll the Government announced that Tax File Number declarations and Super Choice forms would be streamlined by “providing digital services to simplify the process of bringing on new employees.”
There will also be a consultation process to investigate paying superannuation guarantee contributions at the same time as salary and wages.
The Australian Institute of Superannuation Trustees (AIST) welcomed the announcements. Executive Manager of Policy and Research, David Haynes said AIST had “long been advocating for the Australian Tax Office (ATO) to streamline the new employee registration process and merging these forms is a major step toward increased efficiency in the system.”
“Merging and putting the forms online will not only benefit employers, but will also simplify the process for workers and superannuation funds,” he said.
“Simplifying this process may lead to more people making active decisions to choose their own fund which could decrease the number of unnecessarily duplicated accounts.”
The Government also announced consultation on making Superannuation Guarantee payable at the same time as salary and wages, see government may shorten time for super guarantee payments.
Update: We have heard that, following consultations, the start date for Single Touch Payroll may be pushed back.
Update #2: The Government has announced that the start date for Single Touch Payroll will be pushed back.
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