Single Touch Payroll including Employee Commencement Superannuation Industry Engagement Forum Presented by John Shepherd, Assistant Commissioner, Australian Taxation Office / 27 June 2018
Why is Single Touch Payroll so important? Employee Entitlements Streamlining Fund Real Time Information Levelling the Playing Field UNCLASSIFIED Single Touch Payroll 2
Natural business process Employee Employer completes their payroll run through their Business Management System (BMS) Payslip Salary or wages Payment to fund Bank file Bank Fund BMS BMS Pay event submission Salary or wage information Tax withheld Super Guarantee liability Tax and super information sent to ATO via Standard Business Reporting 2 (SBR2) every pay day. What s new Super contribution amounts reported to ATO by super fund Employees view SG liability from payevent as well as contribution received by fund (from MATS) Member Contribution Report Member Account Transaction Service Employer information: Employee information Superannuation contribution UNCLASSIFIED Single Touch Payroll 3
Facts and figures POPULATION 822,000 active employers 16,100,000 employees $2.8 billion per year estimated superannuation guarantee gap Substantial 73,000 Small 749,000 12.3m 3.8m Over 100,000 employees with a debt at year end EARLY ADOPTERS 65 DSP solutions 1,806 employers 164,000 employees UNCLASSIFIED Single Touch Payroll 4
Transitioning to event based reporting and visibility of SG SG liability for each employee (through STP payevent) Fund SG contribution amounts for each employee (through MATS) Display liability and contribution amounts online UNCLASSIFIED Single Touch Payroll 5
Employee Commencement
Background In 2015, the then Minister for Small Business and Assistant Treasurer announced: Employee commencement will be a part of STP The service will be optional and supported through their BMS Benefits Streamline and reduce inefficiencies Improve data capture Improve data quality Support choice of fund UNCLASSIFIED Single Touch Payroll 7
We have co-designed with Industry Consultation and collaboration Digital Service Providers Micro Focus Group Payroll Industry Employers Design Working Group Technical Working Group Employees Super Industry Superannuation industry bodies Discussion paper User testing Tax and BAS agents UNCLASSIFIED Single Touch Payroll 8
How we ve responded to feedback Feedback Resolution Visibility of employer s nominated default fund for employee The employee s default fund is now communicated by the employer to the ATO and the employee as part of using the service Differing views on screen layout and order and the possible behavioural impacts on an employee s choice of fund Accounts will be listed in order of those receiving contributions and then by highest balance An employee will be shown their existing accounts followed by their default fund details Support for consolidation of existing Superannuation accounts Employees will be prompted to consider consolidation when using mygov screens UNCLASSIFIED Single Touch Payroll 9
Expected Delivery Release Phase 1 July 2018 ATO Online via employer software 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 Choice of fund. Benefit Information pre-filled from employer, but ATO Online manages the screen interaction, only information required for employer is returned Phase 2 Dec 2018 (TBC) Employee direct to ATO Online 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 can come direct to mygov as required and support a low cost interaction with the employer Phase 3 March 2019 (TBC) Full software solution Individual uses employers software. ATO authenticates individual 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. Experience managed in employer software, ATO provides key data including residency, loans and choice of fund data. UNCLASSIFIED Single Touch Payroll 10
ATO online via Software (Scenario) 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 7 8 9 10 BMS 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 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. UNCLASSIFIED Single Touch Payroll 11
ATO Online 12 UNCLASSIFIED Single Touch Payroll 12
ATO Online choice form UNCLASSIFIED Single Touch Payroll 13
Progress and next steps BMS BMS Employee Commencement Business Implementation Guide (BIG) published on ato.gov.au Employee Commencement Webinars commencing soon for DSPs, employers and funds. Targeted engagement and support for interested DSPs and employers We will monitor use of the service and report back to industry Design work has commenced for future services UNCLASSIFIED Single Touch Payroll 14