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  • Your obligations under Single Touch Payroll

    Once you start reporting to us through your Single Touch Payroll-enabled software you will be sending us your tax and super information on or before each pay day.

    We call this a 'pay event'.

    You will be able to make corrections to the information you have sent to us through an 'update event', or in the next pay event.

    Find out about:

    See also:

    What you need to report

    Under Single Touch Payroll, there are a number of withholding payments that are either:

    This section provides the details on these payments, the impact on BAS, PAYG withholding payment summaries and annual reports.

    Mandatory reporting

    These withholding payments are required to be reported under Single Touch Payroll. They are generally paid through a payroll process by employers to employees.

    If you report and finalise these payments (and amounts withheld from them) throughout the year you will not need to provide the corresponding payment summaries to your employees or a PAYG withholding payment summary annual report (PSAR) to the ATO if you complete a finalisation declaration.

    This is a declaration in the approved form given to the Commissioner of Taxation by 14 July stating you have fully reported for the financial year and for each of your employees using Single Touch Payroll. You are then not obliged to give payment summaries to your employees (although you may still choose to) or a payment summary annual report to the Commissioner.

    If you do not report and finalise these amounts through Single Touch Payroll you will continue to be required to give a payment summary to your employees and a payment summary annual report to the Commissioner.

    Mandatory reporting labels

    Description

    BAS labels

    (Gross payment, amount withheld)

    Payment summary type

    A payment to an employee, such as salary or wages

    W1, W2

     

     

     

    INB (except INB-P) or FEI

    A payment of remuneration to the director of a company

    W1, W2

    A payment to an office holder (for example, a member of the Defence Force)

    W1, W2

    A payment to a religious practitioner

    W1, W2

    A return to work payment to an individual

    W1, W2

    A payment for termination of employment

    W1, W2

    EMP (life benefit)

    An unused leave payment

    W1, W2

    INB (except INB-P) or FEI

    A payment of parental leave pay

    W1, W2

     

    INB (except INB-P)

    A payment of dad and partner pay

    W1, W2

    A payment to an employee under the Seasonal Labour Mobility Program

    W1, W2

    INB (except INB-P)

    * INB: PAYG payment summary - individual non-business (NAT 0046), INB-P: Individual non-business (pension), FEI: PAYG payment summary – foreign employment (NAT 73297), ETP: PAYG payment summary - employment termination payment (NAT 70868).

    You must submit a pay event even if the amount you were required to withhold from any of these payments was nil.

    Voluntary reporting

    You may choose to include certain withholding payments in your Single Touch Payroll reports. These are not mandatory.

    You can also choose to include reportable employer superannuation contributions (RESC) and reportable fringe benefit amount (RFBA) for your employees. If you choose to include these amounts in a report by 14 July in the next financial year you are not obliged to give payment summaries and a payment summary annual report to the Commissioner.

    If you choose not to report these amounts through Single Touch Payroll, you will be required to give payment summaries to your employees and a payment summary annual report to the Commissioner covering these amounts.

    Voluntary reporting labels

    Description

    Current BAS labels (gross payment, amount withheld)

    Payment summary type

    A payment that is covered by a voluntary agreement

    W1, W2

    Business and personal services income

    A payment under a labour hire arrangement or a payment specified by regulations

    W1, W2

    Business and personal services income

    PAYG payment summary - business and personal services income (NAT 72545).

    Cannot be reported

    Some payments cannot be reported through Single Touch Payroll. These include:

    • payments that are generally not paid through a payroll process
    • payments made by payers to recipients that are generally not their employees, such as
      • Department of Human Services
      • investment bodies and managed investment funds
      • purchasers of certain taxable Australian property.
       

    Payers must continue to provide payment summaries and a payment summary annual report to the Commissioner for these withholding payments.

    In addition, a payer cannot include any payment made through payroll software that is not a withholding payment – for example, partnership distributions and payments to suppliers.

    Payments that cannot be reported

    Description

    Current BAS labels (gross payment, amount withheld)

    Payment summary / annual report

    A superannuation income stream or an annuity

    W1, W2

    PEN or INB-P

    A superannuation lump sum

    W1, W2

    SLS

    A social security or similar payment

    W1, W2

     

    INB

    A compensation, sickness or accident payment

    W1, W2

    Payment of income of closely held trust where tax file number (TFN) not quoted

    Annual activity statement

    Closely-held trust / Annual TFN withholding report

    Recipient does not quote ABN

    W4

    ABN / No ABN, AIIR

    Dividend, interest and royalty payments

    W3

    N/A / Non-residents, AIIR

    Departing Australia superannuation payment

    W3

    DASP

    Excess untaxed roll-over amount

    W3

    N/A

    A payments to a foreign resident

    W3

    Free format / Foreign residents

    Payments in respect of mining on Aboriginal land, and natural resources

    Electronic payment

    Free format

    Distributions of withholding MIT income

    W3

    Free format / AIIR

    Distributions by AMITs (including deemed payments)

    W3

    Free format (for example AMMA statement), AIIR

    Alienated personal services payments

    W1, W2

    Business and personal services income

    Non-cash benefits, and accruing gains, for which amounts must be paid to the Commissioner, except subdivisions 14-C and 14-D

    W3 / Electronic payment

    Most applicable

    Shares and rights under employee share schemes (ESS)

    W1, W2, where TFN quoted

    W3 only, where TFN not quoted

    ESS

    Capital proceeds involving foreign residents and taxable Australian property

    Electronic payment

    N/A

    *PEN: Superannuation income stream, SLS: Superannuation lump sum, AIIR: Annual investment income report, DASP: Departing Australia superannuation payment, AMMA statement: Annual attribution MIT member statement, ESS: Employee share scheme.

      Last modified: 12 Feb 2018QC 54550