Single Touch Payroll Penalties – Small Employers Beware

Avoid a  potential penalty from the ATO

The ATO announced in February 2022 that they have begun the failure to lodge penalty process for the small employer population (19 or fewer employees). If you identify as a small employer and have yet to commence Single Touch Payroll (STP) reporting, then read on.

Since the announcement that STP for Small Employers was mandatory from 1 July 2019, the ATO has focussed on communication and engagement activities such as:

• broad communication through ATO channels,
• general media,
• multiple tailored correspondence to small employers
• client list emails to Tax/BAS professionals with client STP status
• engagement direct with industry groups
• call campaigns to tax agents.

Prior to commencing the failure to lodge process, one further final nudge letter was issued to approximately 700 small employers in late-January 2022.

For those employers who do not take action in response to the final nudge letter, pre-penalty warning letters were announced to be issued as from 18 February 2022.

When an employer receives a pre-penalty warning letter, they will have a further 28 days to take action.