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ATO is Chasing Employee Super with Single Touch Payroll

The Australian Taxation Office (ATO) is beginning to crack down on employers avoiding super payments.
Ever since the single touch payroll (STP) became mandatory for small employers on July 1, 2019, the ATO has been receiving millions of data points tracking superannuation payments.
The ATO is now able to analyze the data that began flooding in this July.
The tax office has had its hands full sorting through the endless information pouring into its database from the single touch payroll initiative. The single touch payroll is able to show real-time data on the payroll from every small business. This means every detail from payroll is being automatically transferred as a report to the ATO.
Everything from salaries, wages, pay as you go withholding, and super liability information is now sent in real-time to the tax office.

The single touch payroll is now able to give the tax office a level of insight and visibility on every employer account that is unheard of. Approximately 75 million transactions from 2019 have already been analyzed by the ATO which covers 400,000 Australian employers.Now that the single touch payroll is in place, the ATO is able to see exactly which employers are making super payments, and which ones aren’t.

In fact, they’ve already begun taking action on chasing employee super payments by contacting lagging employers who have missed super payments or are late paying them.
Thousands of small business owners have already been marked as late-payers of the superannuation. They haven’t only been marked. The Australian Tax Office has already begun contacting them as of mid-October.
This officially marks the first stage of action the tax office is taking directly correlated to using single touch payroll data.

James O’Halloran (ATO deputy commissioner for superannuation and employer obligations) gave a presentation to the Australian Institute of Superannuation Trustees on October 14 stating that about 2,500 employers would be contacted by the ATO.
He mentioned the ATO is contacting every employer who isn’t paying the super in full, on time, or at all, warning them to change their behaviour.

The good news is, the data shows the majority of businesses are, in fact, following the law. However, there is still a large portion that isn’t. On top of the 2,500 employers who the ATO has already contacted, another 4,000 will be contacted shortly with payment reminders.This new action plan of using the single touch payroll data to crack down on payment dodgers is part of a bigger plan.
The Federal Government and the Australian Tax Office are collaborating on a larger strategy to build up Australia’s superannuation program. They’re working together to encourage Australians to centralize their accounts, access unclaimed money, and keep businesses in check with super laws.

In an interview on ABC Radio News Australia, deputy commissioner O’Halloran mentioned the reason the ATO is beginning to crack down on super payment dodgers. He said, “…by not paying SG (superannuation guarantee), of course, the employee misses out for their retirement future, and that’s why it’s important to pay on time.”

If you are struggling with your Single Touch Payroll obligations don’t be alarmed. Chan & Naylor Accountants Capalaba have a range of options and we will tailor a cost-effective solution for your business. Book a free meeting to discuss efficient time and money saving solutions.

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