The importance of paying employees correctly!

Sun glass hut to back pay part time staff 2.3 million

Bunnings underpaid staff super for almost 10 years

Ensure your business

pays correclty

If you run a business, you have to pay your employees and ensure it is done correctly. It’s that simple. Your payroll staff are human, so mistakes are likely to occur from time to time. However, habitual errors may foster mistrust in your employees and cause them to file a complaint against your business with the ATO and the Fair Work Commission.

Under Federal and State Laws, you must compensate your employees by the established payday and as per legal requirements, so if you make payroll errors, resolve them promptly and effectively. For best results, employ knowledgeable and reliable Government Licensed payroll companies and use up to date and accurate software to process payroll, super and meet Government reporting obligations.

How you decide to pay is complicated. There are seemingly endless payroll solutions and services out there for all types of businesses. From comprehensive solutions such as outsourcing to in-house payroll software providers, it’s hard to figure out what’s right for your business. Processing payroll by yourself can be difficult, and if it’s something you’re doing for the first time, it’s crucial that you consult with an expert before you get started. The challenge with processing your own payroll comes with what you may miss – if there are deductions or tax-related issues that you file incorrectly, you can expose your business to serious liability.

What to look out for

Failure to comply

will result in fines

When managing payroll, you must record, track and monitor your company’s payroll expenses. Your system must be able to accurately track all wages and salaries paid, allowances, deductions and other requirements thus ensuring compliance is met.

Fair Work states that you must pay your employees the required minimum wage for their time worked. The modern awards are in place to ensure areas such as overtime, allowances, termination payments etc are paid correctly. Failure to compensate employees and pay applicable taxes / super according to federal and state law may lead to audits and penalties from the ATO and Fair Work.

When it comes to reporting, businesses should ensure they understand their obligations. Single Touch Payroll, Tax File Declaration, PAYG and Payroll Tax are some of the few reporting requirements businesses need to make in terms of Payroll.

HR Pay Solutions can provide your business with expert knowledge in the payroll field ensuring your business pays employees correctly. When assessing your payroll situation, we recommend the following:

• If you are aiming to manage payroll in-house, you use the right software to ensure your business is paying employees correctly.
• If you are aiming to outsource, use Government registered payroll providers who are experts in their fields.

Why do you need outsource?

Outsourcing will

ensure compliance

Not every company has the budget to hire staff as and when they need them. For any company, outsourcing can help keep costs low. With outsourcing, you only need to pay for the services you require, unlike a permanent employee, who requires payment, regardless of whether they’re constantly working or whether it’s tasks that only needs doing every so often. It makes sense that outsourcing is probably going to be a better option.

Outsourced payroll services can be relied on to maintain a consistent approach to payroll management and ensure compliance is met, while keeping costs low. In summary, outsourcing achieves three main goals:

• Frees up time and resources therefore allowing a greater focus on core business activities.
• A reduction in costs and risks.
• Gives your business access to better technology and expertise

The importance of using the right payroll system

Payroll is directly associated with employee compensation. If the system you use to process your payroll has a weakness, it could affect accuracy. Payroll involves more than simply compensating your employees for time worked, and inaccuracy may lead to severe consequences.

It’s easy to pay employees once a job is completed, however having a proper system in place mitigates risk and vastly improves your business operations.

It may sound counter-intuitive, but payroll systems aren’t just about paying employees. Payroll processing is a detailed documentation system that tracks who is working for your company, how long they’ve worked for you and how much money you’re spending on labor. Terms like “payroll processing” and “payroll system” can make this sound complicated, but it’s actually quite simple. If you work with a payroll provider, your “system” will be automatically set up through the company. If you’re on your own, you’ll have to set up your own system.

HR Pay Solutions can provide your business with a leading cloud payroll software that ensures you remain complaint with payroll practices and legal requirements. Our software is customised to your business requirements thus ensuring compliance is met.

How we can help

We believe that Outsource providers and or in-house payroll representatives should understand how payroll works, calculations are made, not only to ensure accurate input and compliance, but also so you can explain to employees how their pay is calculated.

HR Pay Solutions has worked with a wide array of Australian businesses across many industries. We are a Government licensed Payroll provider and can assist your business with all payroll services. Our staff possess over 15 years in this field and have the “know how” on how to deal your payroll requirement.

We provide our customers with a platform and services to mitigate compliance risk, deliver business insight and gain operational efficiencies. From software to outsourcing solutions, organisations of all sizes take advantage of HR Pay Solutions deep expertise to free their team resources and help them focus on driving greater business results.

Information provided in this blog is not legal advice and should not be relied upon.

Do you employ less than 19 employees?

STP is coming….Again

The new reporting requirement has now begun. As of 01 July 2019, businesses with 19 or less employees are required to report to the ATO each pay cycle.

In this article, we explore the important elements of the changes, with a focus on how to ensure your business can remain compliant.

What is single touch payroll?

 STP is

Coming….Again

Single touch payroll is also called real-time payroll reporting meaning every time a business pays their workers, all salary information is sent to the ATO. This includes wages, deductions and super information, eliminating the need for Pay-As-You-Go withholding activity statements throughout the year.

This real-time reporting is generally done through accounting software platforms such as MYOB, Xero or Quickbooks. In fact, this is so prevalent the ATO’s own explainer on the regime repeatedly advises businesses to talk to their third-party software providers.

Each pay run, also known as a “Pay Event”, must be reported every time you pay employees. Businesses must also notify the ATO of any changes to a previous pay run, also known as a “Update Event”.

Reporting is conducted from our Single Touch Payroll (STP) enabled payroll software. This was first introduced in July 2019 for businesses with 20 or more employees

What can’t be reported?

 Be Specific

There are some payments that can’t be reported via the STP. It includes the payments that are not paid in the payroll process. Also, if the payments were made to those that aren’t employees, you don’t have to include it in your STP.

For instance, payments that were made on investment funds or purchases that are considered taxable. For these things, businesses will still be required to provide payment summaries as well as an annual report to the Commissioner for these types of payments.

You also can’t include those that are not considered withholding payment even if it is made via the payroll software.

Why is this happenning?

Firstly, it’s a much more efficient way to run the taxation system, which means it costs taxpayers less.

It also makes black economy activity harder — at least in theory — because the ATO has a better idea of who is being paid what, and when. For businesses, STP reporting can make things easier and more efficient, particularly if the process becomes automated to a degree.

There’s no shortage of concerns about the extension of STP reporting to smaller employers. Worries range from businesses not being aware of the changes to micro-employers (four or fewer workers) not having digital payroll software or access to reliable internet (more on that below).

What is the scale of this change?

 45,000 Businesses

Currently Reporting

The ATO has said about 730,000 businesses will need to start doing STP reporting under the changes. To put that in perspective, there are about 45,000 businesses currently doing STP reporting after it became a requirement for businesses with more than 20 workers in July 2018.

About 15,000 businesses with less than 19 workers are already using STP. This means the ATO will need to increase the size of the STP regime tenfold, an undertaking described by BDO partner Brian Greenacre as a big job.

It’s the biggest compliance undertaking since the GST.

How will it work?

For businesses with digital payroll software, enabling STP reporting can be as easy as a few clicks. For those without it, the ATO has said it won’t be forcing anyone to get it, although they have strongly implied businesses should.

Businesses without digital software will need to comply with the new regime through business activity statement filings, submitted to the ATO. Compliance requirements are increasing and such a change will be a “big step” for many small businesses which don’t have digitised payroll systems.

We encourage businesses to get ahead of the curve and sign up for STP before any legislation passes.

How can HR Pay Solutions help?

HR Pay Solutions is a Licensed Payroll Provider that provides businesses with Employment life-cycle services spanning Payroll advice & outsourcing, Human Resources advice & outsourcing as well as Safety documentation all through our cloud based customised software solution.

Through our software “HRPAY”, you can report your STP directly to the ATO. Our software integrates directly into leading accounting platforms such as MYOB and Xero. Our software is also capable of other payroll and HR capabilities such as time and attendance, onboarding, tax file declarations, documentation and much more.

Set up?

Set up is easy! Simply notify the ATO and link the software with them via the Software ID or let us do it for you. Once ready, the reporting capabilities will be available for every pay run and the information will be filed directly with the ATO.

• Single Touch electronically reporting directly through to the ATO
• Report each “pay event” and provide the ATO with an “update event” for any changes made to past pay events
• Electronically upload Tax File Declaration forms
• Review and update details such as ABN, addresses, business Tax File number and more!
• Review and update employee details including date of birth tax file numbers and addresses
• You can also outsource directly with us and we will ensure your business meets its reporting requirements

Information provided in this blog is not legal advice and should not be relied upon.

Common Payroll Mistakes!

Payroll is

Always Changing

Throughout my time in HR, I’ve come across many scenarios that led to the lawful dismissal of employees due to misconduct, harassment, bullying, theft and many other reasons.

Consider these points the next time you conduct a payroll health check

Tips

Classification

Employees must be classified correctly. When an employee is incorrectly classified, your business may be subject to audits, significant penalties and lawsuits.

Protect yourself and the Company

Outsource to a Licensed Provider, understand the guidelines, or undergo professional training, to make sure you understand and correctly apply the rules when paying employees and meeting your payroll obligations

Garnishments

Garnishments and child support orders can be difficult to implement, especially when employees have multiple wage garnishment orders. You are responsible for tracking and prioritising each employee’s wage attachments.

Payroll Software

We at HR Pay Solutions believe that Outsource providers and or in-house payroll representatives should understand how calculations are made, not only to ensure accurate input and compliance, but also so you can explain to employees how their pay is calculated.

Reporting

Single Touch Payroll, Tax File Declrations, PAYG and Payroll Tax are some of the few reporting requirements businesses need to make in terms of Payroll. When it comes to reporting, businesses should ensure they understand their obligations

How can we Help

Our staff possess over 15 years experience in Payroll and Human Resources and we can provide your business with managing payroll.

Outsource your HR and Payroll to us and focus on what really matters, your business!

Single Touch Payroll

The ATO has changed the way businesses report their payroll

The new reporting requirement has now begun. As of 01 July 2018, businesses with 20 or more employees are required to report to the ATO each time you pay your employees.

The information will include your employees’ salaries and wages, allowances, deductions and other payments, pay as you go (PAYG) withholding and superannuation information.

Reporting is conducted from our Single Touch Payroll (STP) enabled payroll software. Each pay run, also known as a “Pay Event”, must be reported every time you pay employees. Businesses must also notify the ATO of any changes to a previous pay run, also known as a “Update Event”.

How can we help?

We are Government Licenced, and have experts on hand for any enquiry.

• Single Touch electronically reporting directly through to the ATO
• Report each “pay event” and provide the ATO with an “update event” for any changes made to past pay events
• Electronically upload Tax File Declaration forms
• Review and update details such as ABN, addresses, business Tax File number and more!
• Review and update employee details including date of birth tax file numbers and addresses
• You can also outsource directly with us and we will ensure your business meets its reporting requirements

How it looks like in HRPAY

The HR Pay Solutions payroll platform is STP enabled

Set up is easy! Simply notify the ATO and link the software with them via the Software ID or let us do it for you.

Once ready, the reporting capabilities will be available for every pay run and the information will be filed directly with the ATO.