Many businesses are due to begin reporting through Single Touch Payroll (STP) from 1 July 2018, making 1 April an important date in the payroll calendar (and not just for practical jokes on colleagues). An employee headcount will need to be done on 1 April (not unlike the census) to determine whether you are classed as a ‘substantial employer’ or not.
Businesses with 20 or more employees on 1 April will be considered a substantial employer and should begin reporting to the ATO through STP from 1 July 2018. The only exception to this date will be if a business, or their software provider, has successfully applied for a deferred start date. (More information on STP Deferrals is available in this fact sheet from PwC.)
For those businesses with 19 or less employees on 1 April, reporting via STP will be available from 1 July this year but it won’t become compulsory to use it until 1 July 2019.
All businesses need to count their actual number of employees as at 1 April 2018. To do this you will count each individual employee, not the number of FTE. Also, if the business is part of a wholly-owned group, you must include the total number of employees that are employed by all companies in the group.
It’s not necessary to notify the ATO of the number, but it is a good idea to keep a record.
So, who do you include in the headcount?
- All full and part time employees
- Any casual employees that are employed on 1 April 2018 & worked at any time during March 2018
- Employees who are overseas
- Employees who are absent or on leave, whether paid or unpaid
- Seasonal employees
- Employees that terminated prior to 1 April
- Casual employees that didn’t work in March 2018
- Independent contractors
- Labour hire staff
- Company directors
- Office holders
- Religious practitioners
It’s important to note that once you become a substantial employer you will need to continue reporting through STP, even if your employee numbers drop to 19 or below at a later point.
With both the financial year end and STP nearly upon us, it is more important than ever this year to be well prepared. Australian Payroll Association’s end of year training will cover everything you need to know to be able to complete your year-end reporting, as well as a presentation from the ATO on what you need to do to be STP compliant from 1 July.
Full day classroom training will be held across the country between 11 – 15 June 2018. These classes are in high demand, so don’t wait too long and miss your spot! For those who can’t make it to class, there will also be a 2-hour webinar on 6 June 2018. All details, including locations and dates, can be found here.