Tradies may be feeling apprehensive about how the introduction of Single Touch Payroll (STP) will affect their usual payroll management and reporting, but with big change comes big opportunities.
Let’s begin with the big picture. STP is all about increased visibility and automated information sharing. Real-time data is sent to the Australian Tax Office (ATO) every time you pay your employees, including wages, deductions (like workplace giving) and super information.
To do this, small businesses will need to start using a STP-ready payroll solution (if they aren’t doing so already) once STP becomes mandatory from 1 July this year. For many small businesses, this means an entirely new approach to how they manage their payroll.
But there is a silver lining.
STP is an opportunity for tradies, and all small businesses for that matter, to experience the benefits of an accounting solution like QuickBooks Online, which not only offers STP-compliant payroll, but also a suite of other features that can transform your business life.n
70 per cent of tradies told online platform Hipages that they believe technology can free them up to get more done1. Customers using QuickBooks Online tell us it saves them an average of more than 40 hours per week2.
In addition to this, our separate Intuit research confirmed that 62 per cent of early users of STP say it is proving to be a time saver, with a third (34 per cent) saying it gives them back more than two hours per week3. No longer needing to report payment summaries at the end of the year, not having to provide payment summaries to staff, as well as less room for salary payment errors: these are just some of the ways that adopting STP-compliant payroll can help small businesses save time.
And given tradies pass up as much as $120,000 worth of work a year because they’re busy with administrative tasks, according to online platform Hipages, this time saving could be a huge bonus4.
Better decision making
Advantages of using online accounting software include easy, quick access to up-to-the-minute financial data that help you make smarter and more insightful business decisions, informed by reality, not gut feel.
Using accounting software like QuickBooks Online will also increase efficiencies across a range of business tasks, including managing cash-flow, getting paid, reconciling your bank and credit accounts and filing GST and BAS.
For tradies, cash flow is a big one. Online accounting software can shed light on your cash flow trends and give you the power to smooth out your workload and ditch low profit jobs for better ones, while offering tools that help you get paid faster.
Less room for error
Automated information sharing with the ATO every time you pay your employees increases efficiency on both sides, ensuring super payments are being made on time and under-payment is reduced. All of this should save you time and stress, as well as cut down on errors.
It also gives tradies the convenience of managing their payroll and other business finances from your job site or while on the go.
STP means an upfront time and financial investment, but the payback from making the change can be measured in more than just compliance. Talk to your trusted financial advisor if you want to know how to get started on getting STP-ready.