Posts Categorized: BAS and super obligations
Single Touch Payroll (STP) started for all non-large businesses two weeks ago. So all business should by now be reporting wages at the time of payment.
For some this has meant using a payroll software program for the first time. This was the perfect opportunity to ensure that all other HR employment requirements had been attended to.
If you are still struggling with all of this then please contact us so we can discuss ways in which we can help you.
Single Touch Payroll (STP) starts next week!
From Monday 1st July all businesses will be required to report to the ATO each employee’s gross pay, tax and super no later than the day of payment.
Whilst there are extensions available we generally recommend not using them as it only creates more work later – and therefore cost.
If however you need to rely on an extension, then you must have applied for one by week’s end.
Either way, you have to do so something.
We have been taking our clients through the transition journey principally by way of a series of weekly preparatory emails.
If your accountant hasn’t helped you then it is time to change accountants! Contact us below and we can discuss how we can help you.
It came as a personal surprise to see that the super impressive head of Single Touch Payroll (STP) at the ATO resigned on Friday. He has done so just two weeks before some 700,000+/- small businesses are required to report wages at the time of payment.
What are we to make of that?
As of two weeks ago, not even 120,000 businesses in the country were registered for STP. One can only therefore conclude that the vast majority businesses will not be ready for STP come 1st July. That is just 2 weeks from today.
In part, this is not really surprising. STP is the biggest operational change since GST. Moreover, it relies heavily on public accountants being able to help all of their clients. And the reality is that the majority of public accountants haven’t been able to meet their 2018 tax lodgement program and are drowning in overdue Tax Returns. They simply don’t have the time and resources to support what is required to implement STP.
At Maggs Reid Stewart, we are progressively taking our clients through a series of weekly preparatory tasks. And as part of this process, we are guiding clients to clean up their HR systems.
If you are struggling with STP and/or your accountant is not helping you, then please call us. And do so today because this is not something you can attend to on the first pay day in July.
A quick super contribution warning.
In order to claim a tax deduction for a personal or employer super contribution, it must be paid by year end.
This year is a bit of a trap with June 30 falling on a Sunday.
Another trap is that I just read that the ATO’s own employer super clearing house requires payment to be made by the close of business on Monday 24th June. Pay later than that and the contribution will go into the next financial year. That’s a real problem if you have retired and are aged over 65 as you will thereby breach the work test rule in the first week of July 2019.
Some clearing houses and super funds close off earlier than the 24th. Make sure you now what you cut-off dates are.
Are you wondering what you should be doing in preparation of Single Touch Payroll?
Do you know that from 1st July all employers in the country are required to report how much every employee will be paid, the PAYG WH tax thereon as well as what their super will be at the time of payment? And yes whilst there are exemptions it just means more work later.
You need to be ready for Single Touch Payroll now or in the process of getting ready.
So do you know what you need to do before 1st July?
So do you know what you should be doing from 1st July?
If you can’t answer these questions then you need to attend out STP webinar on Tuesday 28th May at 5pm.
You can enrol by clicking on the following link:-
Single Touch Payroll will apply to all employers from 1st July 2019. Whilst extensions have been offered we recommend not relying on them in the majority of cases as it will create more work later.
There are a number of things to do and matters that as an employer you need to have in order before July. Keep an eye out for notification of our upcoming webinar.
In that webinar we will set out the when, what, why and how of Single Touch Payroll.
We look forward to seeing you then.
For those of you who are employers, Friday 26th April is the end date for satisfying your SG super obligation for the March quarter. Late payments will attract interest and penalties. As such, this obligation is an employer’s most important commitment so best not to leave it until the last minute; particularly as payments through some super clearing houses take 5 days or more to clear.
For those who lodge a paper (non-electronic) quarterly BAS or IAS, your March quarter activity statement is due to be lodged by Monday 29th April.
Personal services entities
If you have a personal services entity (you will know if this relates to you as we will have discussed this with you many times over the years), your entity will be required to pay at least 80% of its income to you as salary/wage and remit the tax thereon within this BAS.
Please note that lodgement of an activity statement (even if it is nil statement) and payment are two separate requirements. Late lodgement attracts a minimum non-deductible fine of $210 for every 28 days that a form is lodged late whereas as late payment results in an interest levy. More importantly, BAS’s and SG super which is not reported and remains unpaid after 3 months becomes a personal debt of directors (please refer to the September 2012 edition of Tips and Traps for further details on the Directors Penalty Notices system) – and the ATO are actively issuing DPN notices. That said, the ATO are agreeable to entering into payment arrangements.
And a quick reminder about Single Touch Payroll (STP). STP will be mandatory for all employers from July 2019. You will shortly receive an introductory letter which will be followed by a series or reminders and steps to be implemented before 30th June.
We are always looking for ways to make your life easier.
Our latest initiative is Receipt Bank, a tool which allows a more automated bookkeeping workflow, solves typical specific compliance problems and serves as a back-up system. It does so in a most cost effective manner.
Receipt Bank allows you to upload your business receipts, invoices and expenses into your software or provide them to us seamlessly and easily. You can do so via photo on a mobile app downloaded to your smart phone or via personalised @ Receipt Bank email address.
The twelve main benefits from using Receipt Bank:-
- You save time on sending in your paperwork, time that you can spend on your core business services or more time not attending to paperwork.
- You can use up to any one or combination of four methods to submit information to Receipt Bank.
- The two main methods are taking a photo on your mobile phone or on-forwarding an e-mail.
- It is great solution to those who incur lots of costs on the road whether it be coffee meetings or receipts from Bunnings that are paid by cash or credit card.
- You limit the number of questions we ask.
- You don’t have to forage for receipts from up to 23 months ago.
- You save space as there’s no need to retain your physical documents (if you so wish), with all documents easily searchable and securely stored on the cloud.
- Or you can still keep those physical records but sleep easy in the knowledge that you have a back-up. Furthermore, you can rest easy knowing that your data is stored securely and encrypted.
- You now have real time information flowing into your accounting system, which allows us to provide you with better and more timely insights to improve your business. Receipt Bank works best with Xero and QuickBooks Online.
- No more lost receipts & invoices! No more paying too much tax or GST because you lost invoices and receipts.
- You can access your records from anywhere anytime.
- You can also rest easy in the knowledge that you have read only access after your business has ceased operating.
We welcome your call so e can explain the benefits to you – and other ways we can both simply and improve your life.
Single Touch Payroll has now been legislated to apply to all employers from July 2019. So from 1st July, 2019, all employers must notify the Tax Office of every employees gross pay, tax and super at the time of payment.
Some exemptions and deferrals have been granted.
However, you shouldn’t need them. The main accounting software products offer Single Touch Payroll solutions. Furthermore, there is much preparatory work for which you will need to change and or improve your processes. It is not something bets left to deal with later.
Keep an eye out for future educational and preparatory steps.
The ATO is getting serious about unpaid employee SG super.
Legislation passed last week means employers can be forced to attend educational courses and even be jailed. The ATO will also have the power to issue what are called Director Penalty Notices (DPNS). DPNs make unpaid SG super a personal liability of a director.
The government is greatly concerned about the amount of unpaid SG super. It has now given the ATO the weaponry to address non and under compliance. And from July with the expansion of Single Touch Payroll to all employers, the ATO will know which employers to track down.
Speak to us if you need help with your payroll.