Australia implemented the Single Touch Payroll (STP) system several years ago, and it has slowly been rolled out into business operations throughout the country since that time. Essentially, it is a new means of reporting tax and superannuation information about your employees to the Australian Taxation Office. As of July 1st of 2019, even businesses with fewer than twenty employees are required to start with the STP system.
However, there are many business owners who may have not yet updated their systems to comply with STP. If you are one of these hold outs, then there is still time to get on board. If you simply need some motivation to make the switch, then having a better sense of the benefits involved with the STP will help you out.
Let’s look at some of the specific ways that single touch payroll will save you both time and money.
Improve Accuracy And Efficiency
Single touch payroll makes it much easier for you as an employer to handle the payroll process. Every business owner knows how complex and fraught with potential for error these tasks can be. STP allows you to pre-fill many of your business activity statements ahead of time, so you will be ready when the time comes to declare this information to the ATO. You are also no longer required to submit the annual end of year reports to the ATO, which will free up more time for you to focus on your business itself.
Save Time Adding New Employees To The Roster
Hiring new employees is an essential business task that facilitates growth and specialisation. However, onboarding new employees also take up a lot of time and resources. Fortunately, the single touch payroll system provides an easy means for receiving new employee tax file numbers and superannuation information. This can easily be collected from the Australian myGov website. All of this saves time that you can spend on training your employees and getting them up to speed as soon as possible.
Digitise Your Business Processes
Moving your business processes away from pen and paper to fully digital comes with many efficiency benefits. This means more time and money to spend on the most important aspects of your business. The single touch payroll system is part of a larger effort to digitise more processes within the Australian government. By moving your business in this direction too, you can also reap the efficiency gains that come with greater digitisation.
Most payroll software programs are fully compatible with the single touch payroll system. This allows you to save time when it comes to compliance and knowing precisely what to do with respect to the reporting guidelines of the ATO.
Fortunately, all payroll software that is compatible with the single touch payroll system is highly affordable. This has been enshrined in legislation passed in Australia that requires these software tools to be under a certain price threshold. You can be confident that subscribing to these services will not strain the budget of your business.
Moving Towards, And Benefitting From, Better Government Policy
These are some of the immediate time and money-saving benefits that you can expect from the single touch payroll system. Beyond these benefits, however, the STP system is also aimed at providing the ATO and Australian policymakers with better data to make decisions and regulate business taxation. With this data, your business, along with all other businesses in the country, will also benefit from greater policy responsiveness and an improved business environment.