What employers should know about EOFY with STP
With the changes to the way that you report with STP, what you're required to do at the end of the financial year will also change.
So, we thought we'd go over what these changes are so you know exactly what to do at the end of the financial year.
The biggest change for employers is that if you're doing STP, you're no longer required to provide payment summaries to employees at the end of the financial year.
You also no longer need to submit a payment summary annual report as the ATO would have received this information through your regular STP reports.
Instead you'll be required to submit a finalisation declaration through your STP software.
On Payroller, this can be done by ticked the box labelled EOFY Final.
What you need to do
Firstly, before you submit your finalisation declaration, check that your YTD amounts are correct for each of your employees.
When you're confident that there is no more reportable income, submit your finalisation declaration (click EOFY Final).
Essentially, what this does is inform your employees and the ATO that this information is considered 'tax-ready'.
Your employees will be able to access this information online through the ATO's myGov program.
Employees should wait until the information is tax-ready before lodging their tax return.
As the employer, you will need to submit your finalisation declaration by 14 July.
If you are unable to submit this by the date, you can apply for an extension with the ATO.
However, please note that if you do apply for an extension, you will be delaying your employees from completing their tax return.
You may also realise after you have finalised your reporting that you need to make an amendment.
You're able to do this through your STP software provider. Make sure to check after you've made the amendments that your finalised data is correct.
Be sure to inform your employees if you've had to amend the STP data in case it changes their taxable income.
What you should tell your employees
You should first of all let your employees know that with these changes, you won't be providing them with a payment summary for payroll and payment information.
Inform them of the myGov website and that payment summaries have been replaced with what is called an income statement.
Please note that they will need to get a myGov account to access this data.
If they are unable in any way to get an account, they can hire a registered agent who can access this data for them.
It is also important that your employees know not to start their tax returns until after you have finalised the information and made it tax ready.
Beginning it too early may result in them needing to amend their tax return.
If your employee is also employed by another employer who is not yet using STP, inform them that they still need to receive a payment summary from their other employer.