While Single Touch Payroll Phase 2 (STP Phase 2) started on 1 January 2022, many digital service providers have a deferral in place to enable them to transition their customers over time. Under STP Phase 2, businesses report certain information directly to the ATO through their payroll software, such as:
- details of the remuneration they pay (eg salary and wages to employees, directors’ remuneration);
- details of PAYG withholding, including how the amounts are calculated; and
- superannuation liability information.
STP Phase 2 doesn’t change which payments employers need to report through STP, but it does change how those amounts need to be reported.
Employers need to take note that STP Phase 2 changes require your input. Carefully review your payroll reporting codes to ensure accurate data submission to the ATO through STP.
You will now start to see BAS data pre-filling by the ATO. It’s important to cross-check the pre-filled information with your payroll records to prove the correct data has been submitted to the ATO and ensure correct withholdings are remitted. Any anomalies you identify may highlight errors in your system configuration. Don’t forget that when an employee leaves a job, information must be provided in the employer’s STP Phase 2 report, including the employment cessation date and the correct code indicating why the employee left. Details of termination payments must also be reported to the ATO.