Why Single Touch Payroll Is The Future Of Business Accounting
Since the middle of this year, single touch payroll has become the new norm for business accounting in Australia. Through legislative mandate, the move towards increasing digitalisation in various sectors of government has now moved to incorporate the Australian Taxation Office into the fold. While this new system may have caused some headaches and adjustments for small businesses throughout the country, it is truly the future of business accounting in many ways.
Designed to streamline financial and payroll reporting with the ATO, the single touch payroll system is a great step forward for providing the government with virtually real-time data for decision-making. And with single touch payroll software, businesses in Australia are also able to enjoy the benefits of easier reporting to the ATO.
Looking at some of these points in more detail, let’s run through some of the precise reasons why single touch payroll is the future of business accounting.
More Efficient Reporting Processes
The single touch payroll system is designed to make the process of reporting to the Australian Taxation Office easier than ever before. Now, there is no longer any requirement to complete time-consuming end of year reports for the ATO. Instead, you can simply invest in a single touch payroll software that is designed to be compatible with the new changes. This will make complying with the new system intuitive and easy.
As an added time-saving bonus, single touch payroll also eliminates the need for you to provide your employees with payment summaries each pay period. You can instead direct them to view their payroll information through the online government portal.
Provide Government With Better Data
The cornerstone of effective policy development is high-quality data and information. Single touch payroll brings the process of reporting payroll information into the digital age. This provides the ATO with the most up to date payroll data available for businesses throughout the country. With access to this rich source of information, contemporary and future legislators will be better able to spot opportunities for a more effective policy with ease.
For businesses, having digitised payroll data that is updated every pay period will also allow you to generate better insights and analysis regarding your financial stability. You will be able to better understand where your payroll costs are being directed and whether this is translating into improved revenues and growth for your business.
Increase Your Accuracy
Using single touch payroll software will also allow you to drastically reduce the possibility of human error in the course of calculating payroll information for your employees. Under the new system, the Australian Taxation Office will be able to pre-fill your business activity statements with the necessary information and eliminate the need for you to copy this information from the original source. In the past, this often led to many errors or omissions that wasted time and incurred penalties from the ATO.
Direct Access To New Employee Information
With the single touch payroll system, employers will now have easy access to the tax file number and superannuation information of their new employees. This is easily accessible from the myGov website. Rather than waiting for your employees to find the time to provide you with this information, you can quickly find it yourself without any trouble.
Embrace The Change
While it is always difficult to incorporate major changes like the single touch payroll system into your business processes, the benefits of this upgrade are rapidly making STP the business accounting system of the future. To enjoy the benefits for your own business, invest in a single touch payroll software that works for your team and make the change without delay.