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  • Single Touch Payroll exemptions

    Under Single Touch Payroll (STP) there are exemptions. This includes exemptions for:

    • reporting through STP for a particular financial year, or reporting certain payments
    • reporting certain employees through STP.

    Exemptions for the financial year

    You may be exempt from reporting through STP for the 2018-19 financial year, or exempt from reporting certain payments.

    If you're exempt from STP reporting for a particular financial year, you will need to start STP reporting in the following year, or apply for another exemption. You must continue to comply with your existing PAYG withholding obligations including:

    • reporting and paying your PAYG withholding liability
    • giving payment summaries to your employees
    • giving a payment summary annual report to us.

    Employers with seasonal workers

    We understand some employers need to employ casual workers for a short time during peak periods – such as a long weekend, or due to seasonal work.

    This may increase the number of employees on your payroll to 20 or more on 1 April 2018.

    You will be exempt from reporting under STP for the 2018-19 financial year if both of the following circumstances apply:

    • you had fewer than 20 employees at any one time for at least 10 continuous months out of the preceding 12 months (that is, from 1 April 2017 to 31 March 2018)
    • you reasonably expect to have fewer than 20 employees at any one time for at least 10 continuous months out of the 12 months immediately after 1 April 2018 (that is, from 1 April 2018 to 31 March 2019).

    If you are a member of a wholly owned group, you will only be exempt if the whole group satisfies these two circumstances.

    If you decide to make use of this exemption, you don't need to apply or advise us. However, you should keep records that support your decision.

    Insolvency practitioners

    If you're an insolvency practitioner for an employer with 20 or more employees, you will not be required to report through STP on their behalf in 2018-19.

    However, if that employer was using STP-enabled software to pay their employees and report to us, you can choose to continue STP reporting if you have access to the same software.

    You will need to report your own employees' tax and super information through STP if you're an employer with 20 or more employees.

    You don't need to apply for the insolvency practitioner exemption or advise us. However, if you decide to make use of this exemption you should keep records that support your decision.

    Long service leave and redundancy schemes

    Employers in certain industries, such as building, construction, or cleaning, may make regular contributions to a long service leave or redundancy scheme for their employees. Those employees, who are members of the scheme, may then be entitled to a payment of long service leave or termination of payment if certain conditions are met.

    If you're an administrator of one of these schemes, and you don't use STP-enabled payroll software to manage payments to members, you are exempt from reporting those payments through STP for the 2018-19 financial year.

    You will need to report your own employees' tax and super information through STP if you're an employer with 20 or more employees.

    If you decide to make use of this exemption, you don't need to apply or advise us. However, you should keep records that support your decision.

    Employers with a withholder payer number (WPN)

    If you have a WPN because you are registered for PAYG withholding and are not entitled to an ABN, you are exempt from STP reporting for the 2018-19 financial year.

    This is a class exemption. You do not need to apply or advise us if you use this exemption.

    Exemptions for reporting certain employees

    Some employers may be exempt from reporting payments made to certain employees through STP for the 2018-19 financial year.

    Foreign employees

    You will be exempt from reporting payments to foreign employees if all of the following apply:

    • the employee is employed by an offshore entity, for example, an entity that is non-resident for Australian taxation purposes
    • the employee is seconded to Australia
    • all or part of the employee’s base salary and other remuneration is paid by an offshore entity
    • you maintain a shadow payroll arrangement for the employee, for example, a notional payroll for the purposes of tax and social security obligations and internal tax equalisation and protection policies.

    You will need to report any employee that does not meet all the criteria listed above.

    You don't need to apply for this exemption or advise us. However, if you decide to make use of this exemption you should keep records that support your decision.

    We are also considering further reporting relief and will publish additional information once it becomes available.

    What to do if you need an exemption not listed

    We will consider granting an exemption for reporting through STP for a financial year, or reporting a particular employee or group of employees.

    Employers who run their business in an area with no internet service can seek an exemption for one or more financial years. A registered tax or BAS agent can apply for an exemption on an employer's behalf.

    You should submit an exemption request using the Business Portal, Tax Agent or BAS Agent Portal. Once in the portal:

    1. Select General questions/problems/help as the message topic.
    2. Enter Single Touch Payroll as the message subject.

    Include the following information:    

    • the number of employees on your payroll – this will help us understand the size and complexity of your business
    • the reasons why you are unable to report through STP
    • any steps you have taken to attempt to get ready for STP
    • any supporting evidence that may help us understand your circumstances.

    If you are requesting an exemption for reporting a particular employee or group of employees, provide:

    • the details of the employee
    • the nature of their employment
    • any supporting evidence.

    Once we receive your request, we may contact you for further information.

    Note: The Australian Government announced STP will be expanded to include employers with 19 or less employees from 1 July 2019. This is subject to legislation being passed in parliament.

    Last modified: 09 Aug 2018QC 56187