Whether you are an employee or a finance professional, everyone understands the important role of the payroll function in a business. Ensuring staff are paid correctly, fairly and on time is a huge responsibility. That responsibility can be made much easier or much harder depending on the processes and systems available to the payroll team. Outdated processes and solutions will only serve to create uncertainty and errors. To prepare for the new financial year, there are some changes which will help make life easier. Prepare the right way, with these tips.
There is one very obvious reason why you should be preparing for the new financial year. The Australian Taxation Office has mandated the use of a single touch payroll system for all employers. In order to obtain that compliance, all businesses now require single touch payroll software which records, updates and sends all relevant information to the tax office. It may seem like an inconvenient step to make, but non-conformance to the tax office regulations will be even more inconvenient for your business.
Depending on the makeup of your workforce or the capabilities of your business, tracking manual time sheets or using offline clock-in and out systems can cause problems. Adhering to the recent compliance changes and implementing a single touch payroll solution will remove this problem by creating a single view for all of your employees. Your business no longer needs to manually track employee details such as hours worked, annual leave taken or sick leave taken. Implementing this new change places more emphasis and responsibility on your employees to ensure they are honest and diligent with their details. These changes in processes will require training and explanation to your payroll team. Make sure you take the time to prepare a change management process for your team when the new financial year begins.
Remove double handling
Single touch payroll software helps create a stronger link with the taxation office, but it also helps remove double handling of data for your payroll staff. In financial years gone by, you were required to send all information from the previous financial year to the taxation office by the deadline date. Preparing for the new financial year with a single touch solution means you no longer have to compile the year’s data to send. Instead, the necessary information is sent at the time you pay your employees. Whether you pay monthly, fortnightly or weekly, the necessary tax, income and superannuation details are sent at the same interval. The new solution allows employers to remove a step at the end of the financial year, which is a notoriously busy time already. This change may be new for both employees and your payroll team, take the time to be clear with the change. Be sure to plainly point out what is expected of them.
Preparing for the new financial year means preparing to communicate with your staff. It’s important, with any change, that there are appropriate communications to explain said change. Businesses will need to communicate with their staff to advise of the changes come tax time. PAYG statements are a thing of the past with the new system, meaning employees don’t need to wait for a paper statement to complete their tax return. As a business, designing a communication plan around this change is crucial to success in the new financial year, under the new regulations.
The new financial year brings excitement and a renewed sense of purpose for a lot of businesses. For the teams in payroll, it can be a particularly busy period. Under the new legislation, there are a number of changes that will be required. To prepare your business for the new financial year, use these tips to ensure success.