Single Touch Payroll (STP) for small businesses starts on 1 July 2019 and is now just a matter of weeks away, although the ATO has given an extension until 30 September to be STP ready.
STP is an electronic reporting system for payroll. It means that every time a business pays an employee, information like earnings, tax and super must be reported direct to the ATO in real time. There’ll be no more PAYG summaries at year end, and your activity statements will now come pre-populated with your payroll information.
All of the major software suppliers are STP ready with their cloud based products. If you’re already using this software, you’ll just need to change a few settings, and there’s plenty of help articles available.
If you are using desktop software, or no software, you have two choices. You can upgrade to cloud based accounting software, or you can use a stand-alone STP service. The major suppliers have payroll only software for employers with 1 to 4 employees for around $10 per month or there are other payroll service providers out there who’ll look after your entire payroll process for a more substantial fee.
Full cloud based accounting software will cost your business around $50 to $100 per month for your subscription. Besides looking after your STP, the software will provide you with many other benefits that should outweigh the additional cost.
With your new software you can set up bank data feeds, which means your transactions are fed daily into your software. No more data entry, no more bank reconciliations, and no errors.
Next you can automate your coding using in-built artificial intelligence. You should be able to accurately allocate 80 to 90% of your transactions to the right account without touching the software.
You can store your receipts electronically, invoice from a device and automate debtor follow ups. And importantly, your accountant can log in at any time and use live information to give you better advice.
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Author: Jasmina Nesic
Email: [email protected]