With the rapid technological evolution in an accounting industry, the average time to process daily transactions have reduced substantially. The labour-intensive work of bookkeepers have benefited the most.
Keeping in lieu of these changes, ATO recently has taken a step further to automise the cumbersome payroll processing task into a click of a button job.
Single Touch Payroll is a new way of reporting tax and super information related to payroll electronically. All you need is a STP compliant software like Xero, Quickbooks etc to make use of it.
When you process a payroll, you can lodge it directly with the ATO using the STP compliant software and the information will be sent to ATO directly, this eliminates the need to issue payment summaries to staff at year end as well.
As all the information is processed and sent the chances of getting the payroll reconciliation done incorrectly is slim but offcourse depending on all the categories are appropriately classified.
Please remember:
1) From 1 July 2019 onwards, all employers (except those exempted) will need to report payroll via STP.
2) Employers can’t adjust previously reported payroll data but can run an unscheduled payrun within the financial year to make any changes.. ATO runs a data matching against the business bank account so any changes made need to reflect that.
3) STP data of each payroll cycle will need to be filed to the ATO prior or on the payroll payment date submitted to the banks electronically.
4) Payroll has always been a sensitive and highly regulated matter. With the ATO STP and superstream system, it will be easier for the ATO to catch any employers that do not comply with their employer obligations.