Single Touch Payroll – Phase 2
In the 2019–20 Budget, the Government announced that Single Touch Payroll (STP) would be expanded to include additional information.
Under Single Touch Payroll Phase 2, the Australian Government will require all employers to report additional information through STP on or before each payday. This information will include details such as income or payment type and the reason for any cessation of employment.
Australian businesses that have employees on their payroll will be impacted by this change.
The commencement date for STP Phase 2 is 1 January 2022. However:
- If your solution is ready for 1 January 2022, you should start Phase 2 reporting.
- If your solution is ready and you can start Phase 2 reporting before 1 March 2022, you’ll be considered to be reporting on time and you won’t need to apply for more time.
Xero has been granted a deferral on the start date of the STP Phase 2 for our payroll software, and this applies to all new and existing customers. This means that all customers reporting STP using Xero Payroll have until 31 December 2022 to report their first STP Phase 2 pay run.
One key advantage of Phase 2 is lodgement of Tax File number declaration forms for new employees. Employers are currently required to submit a tax file number declaration to the ATO. Phase 2 will incorporate employee tax information via STP reporting, which eliminates the need to submit tax file declarations to the ATO as a separate process.
If you would like further information, please contact us.