This article covers some common questions about payment summary requirement under STP. Information provided by TAPS (The Association of Payroll Specialists).
Payment Summaries have a new name and location
- Payment Summary information will now be available online at myGov. It will be called an 'Income Statement'.
- Once you start reporting under STP, you will no longer be required to issue a Payment Summary.
- If you transit to HeroPay in middle of the financial year, you can bring opening balance of all employees who are paid within the financial year from previous payroll platform to HeroPay. Then once you start reporting under STP, employee's YTD earnings including opening balance will be reported to ATO. In this case, you are not required to prepare payment summary for the amount paid in previous payroll platform.
Question: Will the ATO be doing a marketing campaign to advise employees about the end of Payment Summaries?
Answer: No. There are currently 60,000 employers live with STP, but there are more than 700,000 small employers that don’t start STP until 1 July 2019. A large marketing campaign would only cause confusion for the vast majority of people that aren’t impacted by the change yet.
Question: How can we notify employees about the changes?
Answer: The ATO has already prepared a range of information that you can share with employees.
- There is a PDF document that summarises the changes. This is an excellent document that can be attached to an email from payroll. Click here
- Setting up a myGov account. Click here
- Accessing your income statement or payment summary online. Click here
Question: What if my employee demands a Payment Summary?
Answer: The law has changed and employers are no longer required to issue a Payment Summary.
- Employees can access their Income Statement via myGov
- If the employee uses a tax agent to lodge their tax return, their tax agent has access to the Income Statement. The employee does not need to give them a paper Payment Summary.
- If the employee doesn’t have access to myGov or a tax agent, they can call the ATO who will issue a paper copy of the Income Statement.
Question: Can I issue a paper Payment Summary/Income Statement to all employees this year to assist with the transition.
Answer: Yes, in theory you can, but it may not be a good strategy. If you do it this year, employees may expect it again next year.