small business talking about single touch payroll

Single Touch Payroll questions answered: Have your say

When the Single Touch Payroll initiative was first floated at the end of 2014, it was touted as a tool that would eliminate several red-tape producing processes and do away with the need for many reporting demands presently dumped on small business owners.

It is called “single touch” because the interactive online tool is intended to fulfil all business reporting obligations (payment summaries, superannuation contributions, pay-as-you-go withholding and so on) “at the touch of a single button” the government announcement said.

Under Single Touch Payroll, employers will be required to electronically report payroll and super information to the Tax Office when employees are paid, using Standard Business Reporting-enabled software.

Read our previous blog for further explanation: “Single Touch Payroll” to cut red tape for employers.

Since then however, feedback from the business community has shown that the proposed start date of July 2016 will simply not be achievable, especially for small and medium sized businesses.

There were concerns expressed by business owners regarding cash flow issues that could result from the government’s plan to have employers remit PAYG withholding and superannuation guarantee contributions in the same transaction as salary payments. Also the fact that the finer details of its design were not even finalised was viewed with great concern.

In June, the government took the initiative and held off on implementing Single Touch Payroll until a more thorough consultation with stakeholders could take place. Read more about the delays in our blog “Single Touch Payroll put on the back burner”.

As a result of committing to further consultation, the Tax Office is keen to address the many concerns that businesses of all sizes have expressed. It says it is aiming to continue to consult with industry groups and business on a revised proposal to test:

  • real time compulsory reporting of payroll information,
  • voluntary real time payment of PAYGW and super guarantee as an option,
  • running pilots with small business from July 2016 to test various scenarios, including simplifying the process of bringing on new employees with streamlined TFN declarations and Super Choice forms, and the timing for implementation.

The Tax Office has thrown open the topic for ideas, and has published a discussion paper on Single Touch Payroll on its “Let’s Talk” web page.

Let’s Talk is a space where the taxpaying community can contribute ideas, ask questions, and generally have a say on tax and super topics. There are online forums, quick polls and surveys that touch on topics that are open for consultation.

The Single Touch Payroll discussion paper includes a wide range of questions that touch upon many of the concerns expressed by the business community. You can read these questions here, which consist of wide ranging questions from the business community — many of which may reflect your own concerns — with responses from the Tax Office.