Single Touch Payroll will be an early warning system for the ATO, allowing it to know far earlier than is currently possible that employer superannuation contributions haven’t been paid.
Senior ATO officials told the ASFA Policy Roadshow that Single Touch Payroll will “give us visibility of an employer’s SG obligation; each quarter we will compare the reported obligation with the contribution made. These new data sources will add significantly to our understanding and identification of non-compliance”.
This would be a “powerful” change, and give the ATO an “early warning” when superannuation hadn’t been paid.
“This will provide a timely visibility we didn’t have previously.”
“Eventually, we’ll be able warn people or check with them much earlier than we can at the moment and that’s really going to be a win for everybody. More transparent information will give the ATO stronger teeth as a regulator.”
“In the near future, members will be able to see all their reported employer contributions through STP and we expect that once members have visibility and the required data, they will question where their payments are; this alone will have a positive impact on SG compliance.”
“The ATO, as custodian of all this information, is expected to collate all the different sources of information into one complete picture for members.”
“We’ve learned from past behaviour that if people know that others can see the data, this will drive a positive compliance outcome.”
“The new data will add greatly to what we know and we’ll be able to target the cases where people are seriously and regularly not complying with their SG obligations.”
The ATO is already using ‘nearest-neighbour risk models’ to identify non-compliant employers.
“These new data models are proving to have a high strike rate.”
“Where visibility becomes a reality and drives behavioural change, this is where all the work and planning comes together and is very exciting for the ATO.”
According to the ATO, use of Single Touch Payroll by employers is tracking as expected. There is also a “very high awareness” of the change, and an encouraging number of smaller employers – 19 or fewer employees – have adopted STP early. This early group already makes up a third of those employers reporting using the new system.
The ATO says it take SG non-compliance “very seriously” and that all employee complaints about their employer not paying SG “are actioned”.
The ATO SG Taskforce plans to close 2,658 cases in 2018/19, raising $134 million in liabilities.
The most recent estimate released by the ATO has the Super Guarantee gap at $2.85 billion in 2014/15, or 5.2%. The SG gap for 2015/16 is expected to be released in the ATO Annual Report later in 2018/19.