Single Touch Payroll. Whether it’s at the top of your to-do list as a business owner, or just keeps popping up in your news feed, for many it remains something that you will “get around to”.
As a small-business owner for more than 25 years myself, I have seen many legislative changes to our tax system come into play. My key learning from the biggest one so far – GST – was about the importance of not fearing change, but managing it.
While it’s easier said than done, managing change – and having fun with it – is the most important thing you can do. It’s about ensuring you’re able to keep looking after your customers, your team members and fulfilling your business priorities.
Where to begin? As with all change, it’s the first step that’s the hardest. Research recently published by Intuit Australia reveals that more than half (55%) of all businesses have little knowledge about what to do to comply with STP.
With this in mind, here are some extra easy ways to take your first steps towards getting STP ready. After all, the deadline for compliance is 1 July.
Phase one: The $10 schnitty pub lunch
Take the team out for a good old-fashioned pub lunch… but with a catch. The cost is that everyone has to provide their updated employee information, for STP purposes.
Take the forms and a couple of pens. Use the opportunity to talk with each other. By the time you’ve finished your snitty, you’ll have gathered all your updated employee information.
Phase two: Time to throw the paper away, get your head in the clouds
If you are still recording your wages and employee information on paper, or even on a spreadsheet, then why not start using technology to make things a little easier for you and your team.
At lunch you gathered all your updated employee information; the next step is to store it in a secure and accessible place. Get some dedicated software to house all of this.
The convenience is that you will now have access to your employee information from anywhere with an internet connection. Thanks to various platforms, you can process your payroll on the beach if you like.
Phase 3: Back at the office
So, you’ve had a nice lunch, your team is satisfied, and you’re now back at the office. What next?
Small-business owners tend to get into a bit of trouble around BAS lodgement time because they often don’t have the money they need to pay their employees tax and superannuation. This isn’t a fun spot to be in. In fact, it can land you in extremely hot water.
The good news is that careful planning can help you to achieve a positive cashflow that will allow you to avoid the drama. One way to avoid running into trouble is to open a new, higher interest, bank account. Each week when you process the payroll, you can move across the tax amount and the superannuation amount. By keeping this money aside and earning a little interest over the quarter, you’ll ensure you have all the cash you need come lodgement time.
Lastly, all small-business owners should speak to their bookkeeper or accountant to ensure they have a broader understanding of STP. This is one of the biggest compliance events for small businesses and your financial advisor is here to help.
Melanie Power, Founder, Program Kickstart for Bookkeepers, www.melaniepower.com