Single Touch Payroll 2018 Australian Institute of Superannuation Trustees Presented by Ian Colhoun Australian Taxation Office
Why is Single Touch Payroll so important? Employee Entitlements Streamlining Fund Protecting employee entitlements e.g. Super Guarantee with earlier visibility of SG late or non-payments Reporting through natural business processes Streamlining employee commencement, including online choice of fund form Real Time Information Levelling the Playing Field Can help prevent tax and other debts e.g. welfare overpayments Reduces unfair competitive advantage Ensures employers meet their obligations UNCLASSIFIED Single Touch Payroll
What you need to know Who has to report? Employers with 20 or more employees will be required to report through Single Touch Payroll. The Australian Government has announced it will extend Single Touch Payroll to employers with 19 or less employees from 1 July 2019. This will be subject to legislation being passed in Parliament. Employers will need to do a headcount of the number of employees they have on 1 April 2018. Which employees do I include? All employees within the ordinary (common law) meaning of employee. Excludes independent contractors, staff provided by a third party labour hire organisation, company directors, office holders, religious practitioners or any employee who ceased work prior to 1 April. What and how often do I have to report? Payments such as salaries and wages, pay as you go (PAYG) withholding and super information at the same time you pay your employees. What wont I have to do if I report through Single Touch Payroll? Employers may not need to provide the ATO with an end of year payment summary. UNCLASSIFIED Single Touch Payroll
How does Single Touch Payroll work? Natural business process Employee Payment to fund Employer completes their payroll run through their Business Management System (BMS) Payslip Salary or wages Fund Bank file Bank BMS BMS What s new Employee Commencement Employers will have the option to invite new employees to complete their Tax file number declaration and Superannuation standard choice forms online. Pay event submission Salary or wage information Tax withheld Super Guarantee liability Tax and super information is sent to the ATO through Standard Business Reporting 2 (SBR2) every pay day. Employee will able to via information information via mygov Super contribution amounts reported to the ATO by the super fund Member Contribution Report Member Account Transaction Service Employer information: Employee information Superannuation contribution *currently being designed
Employee Commencement and online choice of fund form
Expected delivery Phase 1 July 2018 Phase 2 Sept 2018 Phase 3 March 2019 Release BMS Hybrid Design Direct to ATO Online Full BMS Solution Function Link from employer software to ATO Online, complete information in ATO Online, Data returned to the employer. Includes TFN Declaration, withholding information, medicare levy variation and choice of fund. Re-use and expand ATO Online screens, to allow individual to come direct to ATO Online. Individual is able to generate commencement information for employer. Collection of information is dependent upon employer capability. Individual uses employers software, ATO authenticates individual through Trusted Digital Identity Framework and provides data to employer to support the interaction. Information is pre-filled into the employers software to enable completion of employee commencement data. Declaration then made via STP Payevent Benefit Information pre-filled from employer, but ATO Online manages the screen interaction, only information required for employer is returned Individual can come direct to mygov as required and support a low cost interaction with the employer UNCLASSIFIED - Single Touch Payroll Experience managed in employer software, ATO provides key data including residency, loans and choice of fund data. 6
STP Employee Commencement Scenario BMS Initiated Single Session Draft Jenny 1 2 3 BMS 4 ATO Online 5 6 Employer provides Jenny with the login credentials to access the BMS for onboarding. Jenny decides to complete the on-boarding through the BMS Jenny logs into the BMS, completes some of her personal details and then accesses a link which takes her to mygov Jenny is authenticated via mygov Jenny completes the TFN declaration Jenny is given the option to nominate her choice of fund now or later. She decides to do it now and selects one of her existing superfunds 7 8 9 10 BMS Jenny completes the form and reviews the information she has provided Jenny submits the form including completion of the declaration. Jenny returns to the BMS and completes any remaining details required by the BMS. She reviews the information she has provided, saves the information and exits the BMS. Jenny s employer is notified by the BMS that the employee has completed the onboarding. All the information, including what was completed in mygov, is now available for review by the employer.
What Does ATO Online look like? UNCLASSIFIED - Single Touch Payroll 8
ATO Online choice of fund form DRAFT UNCLASSIFIED - Single Touch Payroll 9