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Failure to lodge an STP report - the ramifications.

John Graetz

Part of this issue has been spoken about on "many" occasions, but I don't recall having seen anything recently regarding this next matter. If I fail to lodge STP, it is true that a subsequent lodgement for the same employee/s will update the year to date figures with STP.

Consequently it has been stated that it is not necessary to lodge that missed STP lodgement. However, today I became aware of some ramifications, if that STP is not lodged, after I located a small pay run which had never been reported to STP. It has to do with pre-fill which is now occurring when one lodges a BAS online.

Above the statement for prefill, details are provided for the W1 figure, which can also be seen with editing the PAYG tax withheld figure. After some investigation after I found a discrepancy with my figure, I discovered that one can click on "You can view details at STP reporting". When one clicks on that, it shows the details for each STP lodgement.

However, the only lodgements that appear are those that have actually been lodged with STP. So whilst STP figures might get updated for any employee included in a missed STP lodgement at a subsequent lodgement, it turns out that quite definitely, the figure for gross payment has not been included in the pre-fill figure, because the ATO only tracks actual lodgements.

I cannot recall now if the same thing happens with the tax figure.

This then will be one reason why a prefill W1 figure can differ to that reported on payroll summary reports. John L G

Comments

Acctd4

Hi John

Regarding missed pay run STP submissions …Yes, that’s correct - Each submission doesn’t report that pay run’s individual components but instead just updates all the running YTD balances. The beauty of this is any amendments or changes for (current) employee pays will automatically be corrected in the subsequent pay run(s) - including the recent fix reverting to the Adjusted Gross figure in Hosted back to displaying in STP under Total Gross - & the balances for ALL employees paid in a FY (including those Terminated) are confirmed/updated in the Finalise Year submission anyway.

The ATO prefill-from-STP feature is still very new & is often unreliable. As well as payroll mistakes, successful submissions are not always possible, particularly if configurations are incorrect, or when the ATO portal is down. Therefore , the ATO provides the option to edit both W1 & W2 if necessary. Your actual payroll data (in Hosted) is the source of truth for accuracy & should always be the basis for these label amounts ☺️

Rav

This is a very timely post @John Graetz, I was literally speaking with our dev team about this subject yesterday.

As you probably know already, there are two elements that are included and sent in a STP submission; employee data which is the employee's running YTD balance and employer data which includes total gross and tax amounts for that specific pay run and is what the ATO use to prefill for BAS.

As you've highlighted, historically when a submission is missed and the next one sent in its place, or if the same submission is sent twice/multiple times, it hasn't made too much of a difference until now because all its done is overwrite/update the employee's YTD balances.

However, now that pre-filling for BAS is in the mix, it makes things a tad more complicated and I feel that it potentially puts the emphasis back on a couple of things; not missing a submission/sending it multiple times and also ensuring that its correct before its sent.

Obviously, that won't always be the case but for a little more context on the latter point, when you go back to correct employee balances via an update event, there is no employer component to that type of submission so all it does is adjust employee YTD balances, it won't have an impact on adjusting any prefill data.

@Acctd4 Shaz's reply above is absolutely bang on, and if I didn't know better is almost like she was in the meeting I had about this yesterday because she's even used some of the exact words our Hosted product manager did! 😂

When it comes down to it, the payroll software is what you should lean on as your source of truth so if the BAS prefill isn't matching, then adjust/amend the W1 & W2 prefill amounts in the ATO Portal where needed. Hopefully that isn't something you need to do often and I'm sure this process will become more streamlined as prefill continues to progress/evolve over time.

Would be keen to hear your thoughts 🙂

John Graetz

I totally agree with both you and Shaz. The only proof in this whole exercise is that payroll summary report. I will always take notice of that and amend either the W1 label in the draft Reckon BAS and now also the W1 field on the ATO website, if necessary. John L G

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