From 1 July 2019, even small employers are required to report their payroll electronically via STP. The ATO recognises that for small employers, a standalone payroll service or solution is best. There are a number of options available to small employers
Options for Small Employers
1. Use Your Existing Cloud Accounting STP Compliant Software
Most Accounting packages are ready for STP. To find out how to connect your accounting system to STP, contact your support provider.
2. Use a Payroll System for Small Employers
There are many ATO approved payroll systems being released by software providers by July 1 specifically designed for small employers. They are payroll solutions that retail for about $10 per month and provide the capability for you to record and process your payroll and STP for 1-4 employees.
Xero have a payroll product for $10 per month which is full payroll limited to 4 employees. We have a special package available to small employers that will setup their Xero payroll system and provide training for a one-off fee. You may then confidently process your payroll and lodge your own STP every pay event. Xero payroll is very easy to use and as your business grows, you can increase your subscription to utitlise accounting or more employees.
* Some standalone payroll solutions will enable you to lodge STP but will not integrate with other accounting systems. If you plan to grow your business, consider this when selecting the payroll solution to best suit you.
2. Use a BAS agent or Tax Agent to Lodge Your STP
If you do not have a cloud payroll system that is STP compliant and you don’t feel confident learning a new system, you may enlist the services of a BAS or Tax Agent to prepare and lodge your payroll and submit to the ATO using STP on your behalf. You will need to sign a letter of authority and provide payroll data to the agent. You will also need to pay for the service and software. However, the benefit of having a professional preparing and checking your payroll, to ensure you stay on the right side of the law could save you money in the long run.
Q. Can I send the information to the ATO or fill out a form?
No. STP is a major change to the way employers report and file their data. The ATO will not provide any other method other than through STP compliant software for all Australian employers.
The ATO have allowed a 3 month period of adjustment for small employers. If you are a small employer, penalties will not be issued for the period 1 July 2019 to 30 Septemeber 2019 to allow time for small employers to get on board with STPWe have an easy Xero Payroll Standalone Package solution that will get you up and running on Xero Payroll