Smaller employers to come on board with Single Touch Payroll
On 29 August 2017, the Australian Government announced it would expand Single Touch Payroll to employers with 19 or less employees. This is subject to a legislative amendment being introduced and passed in Parliament.
This expansion is part of a broader package of reforms to give the Australian Taxation Office (ATO) near real-time visibility over superannuation guarantee compliance by employers.
Employers with 20 or more employees are still required to transition to Single Touch Payroll from 1 July 2018. Smaller employers will be required to report through Single Touch Payroll from 1 July 2019.
You can read the full media release from the Minister for Revenue and Financial Services, Kelly O’Dwyer, Turnbull Government backs workers on superannuation.
Employee commencement service
Following extensive consultation with industry we will defer the release of the employee commencement service through myGov and work towards an enhanced release in a March 2018 timeframe.
Employee commencement is an optional service to streamline the employee on-boarding process for employers and employees.
The government’s commitment was to deliver a service available in myGov as well as one that was better integrated into employer Business Management Software.
Feedback indicates most digital service providers strongly prefer a service that is fully integrated into their software, enabling the data to be presented and captured within their existing on-boarding process (where they offer one). The deferral to a March 2018 timeframe will allow this to occur.
Consultation with the superannuation industry on the super choice screens indicates that a number of the key issues raised could be addressed within a March 2018 timeframe.
Payroll reporting: Business implementation guide
An update of the Single Touch Payroll, Payroll reporting: Business implementation guide is now available. This document contains the business rules and scenarios and will help you understand the business context surrounding the functionality of the design requirements.
We are holding two Q&A sessions during September 2017 to give digital service providers the opportunity to ask questions or clarify their understanding of the business rules and scenarios. The sessions will be held:
- Tuesday 12 September
- Wednesday 20 September.
Updated timeline for releases
From October 2017:
Digital service providers will have the ability to build functionality for employers that includes the ability to:
- lodge an update event
- send a ‘classic xml’ file to the ATO’s myGov portal
- inform their employees they can see their payment information through myGov.
From March/April 2018:
Enhanced functionally will be available for employee commencement online solutions.
On 1 April 2018:
Employers will need to count the number of employees they have on this date and include them in their headcount to determine if they have 20 or more employees.
From 1 July 2018:
- Single Touch Payroll reporting will be mandatory for employers with 20 or more employees.
- Employers who report an employee’s payment and withholding details through Single Touch Payroll may not have to provide that employee with a payment summary at the end of the financial year.
Superannuation payment reporting
- The ATO has worked with the super industry to redesign large super fund reporting. This initiative is known as the APRA fund superannuation reporting transformation.
- The initiative includes the requirement for super funds to report to the ATO more regularly, known as event-based reporting.
- Initially, the Single Touch Payroll design required employers to report to the ATO both when they accrued a super guarantee payment obligation, and when that payment was made to the super fund. However, it was widely agreed by industry and government that super funds should report the payment of the contribution to the ATO, not employers. This will create visibility of non-payment or late payment of super entitlements and enable the ATO to take prompt action.
- Under the new design, super funds will report contribution payment transactions through the Member Account Transaction Service (MATS).
- Employers will not be required to report the payment of super contributions to the ATO.
Working group updates
Single Touch Payroll advisory group
The Single Touch Payroll advisory group has been focused on strategic discussions relating to the Single Touch Payroll program focus areas.
Further information on the agenda and outcomes of each meeting can be found at Single Touch Payroll advisory group.
Design working group
A number of micro and focus groups have been held to discuss:
- authorisations and declarations – definition of roles, Single Touch Payroll authentication model, declaration scenario overview and declaration scenarios process map
- employee commencement (future state flows) – this was progressed with a micro group in August.
- finalisation of scenarios and use cases
- exemptions and deferrals framework.
Further information on the agenda and outcomes of each meeting can be found at Single Touch Payroll design working group.
Technical working group
The technical working group held Single Touch Payroll-specific sessions based on issues raised by the Single Touch Payroll advisory group. Technical focus groups are being formed to progress specific IT technical issues including:
- technical authentication, encryption, security
- system performance tuning related to electronic messaging errors, file sizes etc
Further information on the agenda and outcomes of each meeting can be found at Software developer technical working group.
Readiness working group
The last two readiness working group meetings were held on 7 July and 3 August 2017. The group worked through some key areas in these meetings relating to success indicators, readiness criteria and communications products.
A number of micro groups with a small number of members have been held over the past month to focus on key messaging and communications, the readiness criteria and success indicators.
Further information on the agenda and high-level outcomes of each meeting can be found at Single Touch Payroll readiness working group.