What you read on social media can be misleading and frustrating information.
Benjamin Franklin is attributed to the quote “… nothing can be said to be certain, except death and taxes”. I’d add to that, changes in tax laws.
It seems like every year; there’s another change in taxes that impact business owners. Big changes took place with the introduction of the GST and Superannuation Guarantee.
The recent implementation of Single Touch Payroll (STP) is one of those changes that has crept up stealthily upon us. Businesses employing 20 or more staff had to comply with this legislation on 1 July 2018.
From 1 July 2019, employers with 5 – 19 employees are required to report under the Single Touch Payroll system. There is a transitional period to 30 September 2019 by which time you have to be reporting.
For employers with 1 – 4 employees, there are a few options. One option is having your BAS or Tax agent report for you every quarter. Alternatively, you can opt for a low or no cost payroll solution.
For more information, this is the link to the ATO website information.
The legislation and information readily available on the ATO website are clear about what you are required to do.
There did seem to be a complete lack of information about the impact on employees. Specifically, that there is no requirement to issue Payment Summaries. STP pushes the information directly into the employees MyGov account.
I recently saw a post from a reputable organisation reminding employers of their obligations under the STP legislation. That was great, but there were comments provided by other people who emphatically advised that it only applied to employers of 20 or more employees.
On checking the source of that and similar comments, the people weren’t accountants or bookkeepers. People were blatantly refuting information that was correct and providing misinformation that potentially people reading would take as the truth.
This isn’t the first time I’ve seen these sorts of comments on social media and no doubt it won’t be the last. But please, if you read the information that relates to taxes and legal matters; get professional advice to check whether it applies to you or not.
Take a minute to do some research on the official websites. If you’re still not sure what it means, seek advice from someone whose job it is to know the right answers. In the case of STP, your bookkeeper, if you have one, would be able to help. If not, your accountant.
While you may cost you money to get advice from your accountant, the cost of not getting the advice and thus failing to comply with legislation may cost your business considerably more.
My colleagues in the payroll industry tell of horror stories of penalties in the thousands of dollars for what on the surface seem like minor infringements or errors.
Why? Because the business owner didn’t seek proper advice and “thought” they were doing what they needed to but were, in fact, in serious breach of some of the basic requirements of employing people.
The ATO has a history of going easy on people during the transition phase of changes. Once that is passed, they have the power to hit you with penalties and interest charges. You don’t want to have the time wasting and stress of having to go through the process of digging out information and the potential of having your accounts audited too.
Beware what you read on social media and make sure you check with your professional advisors if you’re in any doubt as to what your obligations are.
Originally published on www.smallville.com.au