What You Need to Know About STP Phase 2 Reporting
The STP Phase 2 reporting is an upgraded version of the current STP reporting. STP reports containing employee payroll information should still be sent to the ATO each time a payrun is processed.
STP Phase 2 is a move towards more complete digital records and reporting.
This update will reduce the burden on employers who need to send reports to multiple government agencies about their employees. The other agencies can collect the employee’s information directly from the ATO since additional information is being collected through the STP.
What stays the same?
- Lodging STP report
- The due date for STP reports is still on or before payday, unless you are eligible for a reporting concession.
- Types of payments in scope for STP reporting
- Tax and superannuation obligations
- EOFY requirements
What’s changing?
In phase two, employers will find it easier to report specific payment details made to employees across all forms of income.
In STP Phase 1, all income is automatically combined and reported as one total. For Phase 2, Gross Income will be separated, which includes the following:
- Gross residual
- Salary Sacrifice
- Bonuses and Commissions
- Overtime
- Director Fees
- Paid Leave
Allowances will also be separated, including:
- Car expense
- Laundry Allowances
- Meal Allowance
- Travel
- Accommodation
The following additional fields will also be needed for the employee details:
- Employment basis
- Reason for cessation
- Tax scale
- Offset amount
What should you expect?
- Reports will now be automated; in short, there will be no more separate reporting for other government agencies.
- Back payments will be easier to report as Phase 2 has the updated capability to capture back payments and payments in arrears.
- Employers will no longer need to send in employees’ TFN declarations. However, you will still need to complete it for the new staff and keep it for your records.
The deadline for transitioning to Single Touch Payroll Phase 2 is on 31 March 2023.
Why wait until the deadline when you can do it now?
Start the transition to STP Phase 2 as early as today to address any errors earlier and avoid stressing over it on the deadline!
If you need our assistance in transitioning into STP Phase 2, please email us at [email protected].