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Single Touch Payroll (STP) is the way you report your employees tax and super information from your STP-enabled/Digital Service Provider (DSP) payroll or accounting software to the Australian Taxation Office.
Phase 1 of STP was first introduced in July 2018.
Phase 2 of STP is designed to reduce reporting burden for employers who need to report information about their employees to multiple government agencies. It doesn’t change the payments, it only changes how the amounts need to be reported.
These payments are now being shared with other government agencies, such as Services Australia for Centrelink and Child Support Australia for payments.
Because reporting payments for Services Australia requires different reporting guidelines, there are a number of new reporting categories that need to be set up in your software file (Xero, MYOB or Quickbooks).
Many DSP’s have obtained a blanket deferral for all customers from the Australian Taxation Office (ATO), which means you may have until 1 January 2023 to move to STP Phase 2.
What you need to do?
You will need to start reporting the additional information when your product is ready, so you should start preparing now.
Many DSP’s are releasing their product changes progressively. Below are links for instructions for each DSP relevant to you and your business, and its important that you follow them.
- Xero (Single Touch Payroll Phase 2 guide.pdf | Powered by Box)
- AccountRight for MYOB (Getting ready for STP Phase 2 - MYOB AccountRight - MYOB Help Centre)
- Quickbooks (Preparing for Single Touch Payroll (STP) Phase 2 (intuit.com))
The ATO have many resources to help you understand the changes and prepare and can be found at ato.gov.au/STPresources.
If you require assistance from us with this, please let our team know and we can log in and review these settings for you.
Need extra time to transition?
As mentioned above, many DSP’s have obtained a blanket deferral but if you need more time past 1 January 2023, please don’t hesitate to contact us to assist you in applying for another deferral as your Registered Agent.
Alternatively, you can find out more about deferral requests for delayed transitions on the ATO website (ato.gov.au/delayedstp2transitions).