The single touch payroll (STP) system is a new reporting procedure for declaring your taxation and superannuation information to the Australian Taxation Office. As a business owner, you have likely already heard about the STP. If you still need to get on board, then it is important to do so soon. The STP actually simplifies the process of reporting your payroll information and provides a host of other benefits.
And, with the right STP software, it is easier than ever to implement the single touch payroll system in your business. Most contemporary payroll software packages in Australia are fully compliant with these new rules. And best of all, they are legislated to be affordable, so you can be sure that investing in such software will not break the bank.
To give you a better sense of the goals of the single touch payroll system, let’s look at some of the ways that it can simplify your payroll process.
Streamline Your Payroll Reporting
Naturally, one of the biggest benefits that come with adopting the single touch payroll system is included in the goal of the program itself. The STP system makes submitting your up-to-date payroll information to the ATO with ease. The system also streamlines the process by allowing you to submit your payroll information after every pay period, rather than on a monthly or quarterly basis. This allows you to keep your payroll data much more organized.
Provides Government With Better Data
By providing the ATO with up to date payroll information, the government will be able to adjust its taxation policies in accordance with the reality of the business landscape. While tax legislation is regularly adjusted to fit the needs of the country, the timeliness of payroll data reporting under the STP will allow for even more responsiveness on the part of the ATO.
Move Towards Digitalisation
While many businesses have been hesitant to shift their processes over to a digital format, the STP gently encourages businesses to take the leap in this direction. By moving towards greater digitalisation, your business can take advantage of many other productivity and efficiency gains. Digitalisation also makes things much simpler for your payroll, and other business, processes. Those businesses that adopt technologies earlier are also more likely to thrive in a competitive marketplace.
The potential for human error in completing payroll information is a real problem in businesses everywhere. Small mistakes can end up costing you valuable time and money to fix. Many features of the STP are designed to lessen the possibility of these errors. For example, the single touch payroll system allows you to pre-fill business activity statements. This reduces the chances of double-counting or making mistakes when going back over your past financial data.
Onboard Your New Employees Accurately
The process of adding a new employee to your business can take a long time. All of the information that needs to be added to your system can take time to verify. The STP allows employers to easily access their new employees’ tax file numbers and other payroll information directly from the government. This speeds up the process of information gathering and allows you to spend more time actually training your new employee rather than sorting out administrative details.
Simplify With Single Touch
The single touch payroll system has recently been made mandatory for all businesses in Australia. As such, it is important to implement these changes in your own business as soon as possible. If you have not already done so, then the benefits outlined here will convince you of the importance of such an initiative.