Chartered Accountants Australia and New Zealand (CAANZ, formerly ICAA) have told the ATO that superannuation guarantee payments from employers should be made more frequently, as part of Single Touch Payroll.
What is Single Touch Payroll (STP)?
Single Touch Payroll (STP) is a Government initiative for employee Superannuation Guarantee and PAYG Withholding amounts to be automatically reported to the ATO during the payroll process.
Large employers (20 or more employees) had to use Single Touch Payroll from 1 July 2018.
Small employers (19 or fewer employees) may have to use it from 1 July 2019, depending on the passage of legislation.
The Association of Superannuation Funds of Australia (ASFA) has criticised aspects of the proposed Single Touch Payroll system.
Single Touch Payroll is a system for businesses to electronically report their payment obligations to the ATO, including PAYG withholding and superannuation. It was announced by the Government in September 2014.
The ATO has raised a number of potential issues with Single Touch Payroll, as part of a consultation process.
Single Touch Payroll is a system which the Government says will “cut red tape for employers by simplifying tax and superannuation reporting obligations,” by reporting PAYG withholding and Superannuation Guarantee obligations at the same time as salary and wages are paid.
The Minister for Small Business, Bruce Billson, and the Assistant Treasurer, Josh Frydenberg, have announced the Government will consult on employers making Superannuation Guarantee contributions and PAYGW payments at the same time as salary and wages.
Currently superannuation guarantee only needs to be paid within 28 days of the end of the quarter. Pay As You Go Withholding (PAYGW) only needs to be paid quarterly or monthly for many employers.
The consultation will also examine “what support businesses may require to enable such a transformation in payments to government and superannuation funds.”
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.