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  • Exemptions

    Under Single Touch Payroll (STP) there are exemptions for reporting for:

    • a particular financial year
    • certain types of payments
    • certain types of employees.

    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.

    On this page:

    Exemptions for certain payments

    Insolvency practitioners

    If you're an insolvency practitioner for an employer that is required to report through STP, you won't be required to report through STP on their behalf in 2018–19. However, you will need to start reporting through STP from 1 July 2019.

    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.

    Alternatively, if you're an insolvency practitioner for an employer that 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.

    If you're an employer with 20 or more employees, you must still report your own employees' tax and super information through STP in 2018–19

    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. Employees who are members of the scheme may be entitled to payment of long service leave, or a termination payment, if certain conditions are met.

    If you're an administrator of one of these schemes, and you don't use STP-enabled software to manage these payments to members, you are exempt from reporting these payments through STP for the 2018–19 and 2019–20 financial years. However, you will need to start reporting these payments through STP from 1 July 2020.

    You need to report your own employees' tax and super information through STP.

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

    Exemptions for certain employers

    Employers with a withholding payer number (WPN) are exempt from STP reporting for the 2018–19 and 2019–20 financial years. You will need to start reporting these payments through STP from 1 July 2020.

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

    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. These payments need to be reported from 1 July 2019.

    Foreign employees

    You will be exempt from reporting payments to foreign employees for the 2018–19 financial year 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.

    For the financial year commencing 1 July 2019, we are considering concessional reporting arrangements for these types of employees and will be publishing further guidance soon.

    If you need an exemption that's not listed

    We will consider granting an exemption for reporting through STP for:

    • a financial year
    • a particular employee or group of employees.

    Small employers (5–19 employees) may be exempt from STP reporting if they meet any one of the following criteria:

    • no or low digital capability
    • no or unreliable internet service
    • other special circumstances.

    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.

    How to apply

    You or your registered agent can submit an exemption request online. If you are unable to access online services, you can phone us on 13 28 66.

    To submit online follow these steps:

    • In the Business Portal – Select Manage employees then STP deferrals and exemptions.
    • In the Tax or BAS Agent Portal – Select Client's employer obligations then STP deferrals or exemptions.
    • In Online services for agents – Select the client then Business then STP deferrals and exemptions.

    In each case, 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.

    We may contact you for further information about your request.

    See also:

    Last modified: 19 Sep 2019QC 56187