ATO Defends Single Touch Payroll

The Australian Tax Office has hit back at criticism of the Single Touch Payroll arrangements from small business groups and industry superannuation funds.

The ATO took the unusual step of issuing a detailed statement rejecting a number of claims by the Council of Small Business and the industry superannuation funds organisation Industry Super about the Government’s changes implementing Single Touch Payroll for smaller businesses and tightening up on Superannuation Guarantee compliance.

In a statement entitled “Setting the record straight on single touch payroll”, the Tax Office rejected what is said were misconceptions about the Single Touch Payroll processes when a new employee joins a business.

These ‘myths’ include the idea that employees will be obligated to complete their Tax File Number declaration details and choose their super funds through the myGov portal, rather than using the standard paper forms, and that the streamlined online processes will be used by the ATO to “track” businesses and how they hire new employees, which the office says is a myth about the entire scheme.

The ATO said it was “aware of recent media commentary regarding the implementation of aspects of Single Touch Payroll. This commentary relates specifically to proposed changes to the process when an employee starts a job.

“As the government agency leading the implementation and administration of the Single Touch Payroll, the ATO would like to clarify some misleading assertions made in this commentary.”

The ATO issued the statement after Industry Super said it wanted to see further changes implemented as part of STP and the SG compliance package.

Industry Super said it was “calling for: • Alignment of super payments with wage and salary income; • Single Touch Payroll to include compulsory reporting of the wage base for super guarantee; • Removal of the $450 monthly threshold.

“Industry Super looks forward to working with the Government and Parliament to secure further necessary changes to give workers assurance they will be paid.”

Council of Small Business Australia chief executive Peter Strong told SmartCompany that small business was cautious about the implementation of STP after recent ATO outages. “In the end, [Single Touch Payroll] is a good thing, but it has to be seamless and it has to require no extra work,” he said.

“What happened recently with the outages is that it has caused a big concern from those businesses that are most affected, like the accountants.”