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Employer super issues

Single touch payroll

Section: 1.4

Single Touch Payroll is a government initiative to streamline business reporting obligations.

From 1 July 2018, employers with 20 or more employees must report superannuation liability information, ordinary time earnings (OTE), salary or wages, and pay as you go (PAYG) withholding information to the ATO from their payroll solution at the same time they pay their employees.

Reporting through Single Touch Payroll means that when an employer completes their normal payroll process, their employees' super guarantee information will be sent to the ATO directly from their payroll solution.

When an employer pays their employees' super guarantee contributions, the same details that are sent to the super fund are sent to the ATO.

Clients who are employees should be able to see more super information online when employers adopt this reporting, making it easier to track super contributions. Legislation to implement this change became law on 16 September 2016, effective 1 July 2018.

Proposed legislation

At the time of writing, there is a bill24 before Parliament to amend the tax laws to:

  • broaden the Single Touch Payroll reporting requirements to apply to all employers, regardless of the number of employees from 1 July 2019
  • remove the requirement for employers to report employer superannuation contributions to the ATO as part of Single Touch Payroll. This change is the result of improved fund reporting to the ATO by large funds under new 'event-based reporting requirements' from 1 July 2018. Under event-based reporting, the ATO will receive information on superannuation contributions paid by employers for each employee member account. Therefore the current requirement for employers to separately report information is no longer required. The removal of this requirement for employers to report superannuation contributions will apply to contributions paid on or after 1 July 2018.
  • require employers to include 'sacrificed ordinary time earnings amounts' and 'sacrificed salary or wages amounts' (i.e. salary sacrificed amounts) paid to their employees' superannuation funds in the amounts reported under the Single Touch Payroll reporting rules.

This proposal will take effect from the later of (and contingent upon) the commencement of Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 2) Bill 2017 and royal assent.

The three proposals above are not yet law at the time of writing.

Last modified: Tuesday, April 30, 2019