ATO reminder for employers – Finalise STP data for 2020
The ATO has issued a reminder to employers who
report through Single Touch Payroll (‘STP’) – which
should be all employers, unless an exemption or
deferral applies – that they will need to finalise
payroll information for the 2020 income year by
making a declaration.
The due date for making finalisation declarations is: long as you are:
- 14 July 2020 for employers with 20 or more employees; and
- 31 July 2020 for employers with 19 or fewer employees.
Employers that finalise through STP are not required
to provide payment summaries to employees and
lodge a payment summary annual report to the ATO.
Instead, employees will be able to access their payroll information (for preparation of their 2020 tax return) through a registered tax agent or via ATO online services.
Editor: Please contact our office if you require more information on finalising STP data.
Guidance on JobKeeper reporting via STP
The ATO has issued guidance to help employers reporting eligible employees and JobKeeper top-up payments through Single Touch Payroll (‘STP’). For each eligible employee, employers must notify the ATO:
- when an eligible employee started being paid JobKeeper payments;
- top-up payments to employees earning less than $1500 per fortnight; and
- when an employee is no longer eligible and JobKeeper payments need to be stopped.
The ATO says this process will be managed through
the 'STP Pay Event' by entering the relevant
JobKeeper description (as outlined below) in the
'Other Allowances' field.
To report the JobKeeper start fortnight for an eligible employee: Use the description ‘JOBKEEPER-START-FNXX’ where ‘XX’ represents the JobKeeper fortnight from which the first payment is made.
Report the amount as ‘zero’, or as $0.01 if the software does not support reporting ‘zero’.
To report a top-up payment for an eligible employee ordinarily earning less than $1,500 per fortnight: Use the description 'JOBKEEPER-TOPUP' for the top-up amount.
To report the first full JobKeeper fortnight an employee became ineligible: Use the description ‘JOBKEEPER-FINISH-FNXX’ where ‘XX’ represents the JobKeeper fortnight in which the last payment is made.
For example, an employee resigns, and their last payment was on 13 May 2020. As this falls in JobKeeper fortnight 04 (being 11/05/2020 – 24/05/2020), the description 'JOBKEEPERFINISH- FN04' should be used to notify the ATO that the employee is not eligible for JobKeeper from FN05.
Making corrections to (previously reported) JobKeeper start and finish information The ATO’s guidance identifies several situations where errors made in reporting the JobKeeper start or finish information may need correction and sets out options for doing so.
In particular, guidance is provided for making corrections where:
- the wrong employee was reported as starting or finishing;
- a later start or finish fortnight is incorrectly reported;
- an earlier start or finish fortnight is incorrectly reported; or
- a future-dated start or finish fortnight is reported.
The ATO is urging employers to exercise extreme
caution to ensure the accuracy of originally reported
information as multiple corrections cannot be made
through the STP Pay Event, 'Other Allowances' field.
Editor: Please contact our office if you require more information or assistance on reporting JobKeeper payments through STP.
COVID-19 and tax depreciation reports – are physical inspections necessary?
Property investors and businesses will often engage
a specialist quantity surveyor to prepare a tax
report on capital works and depreciation deductions
available to them under the tax law in respect of
their income-producing properties – for example,
a rental property, office building or factory.
A thorough physical inspection of the property by a quantity surveyor plays a vital role in this process in order to, amongst other things:
- identify all possible deductions available under the tax law;
- provide accurate valuations of qualifying plant and building works;
- provide supporting documentation of a taxpayer’s claims for depreciation and capital works deductions, which is prudent in the event of an ATO audit.
We have become aware that some quantity
surveyors are promoting tax depreciation reports
that do not include a physical inspection of the
property due to COVID-19 precautions.
Usually the reports are provided, with an offer to do an inspection at a later time when it is possible to do so.
However, in some cases, no offer of a site inspection is made at all.
Where a physical inspection of premises is not performed, this increases the risk of deductions being missed or errors being made. This could result in costly adjustments if a taxpayer has to subsequently amend their tax return or is audited.
Editor: Please contact our office if you require more information about using quantity surveyor tax depreciation reports.
Please Note: Many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.