The short answer is no. Once you report STP during the financial year, regardless of the time of year you began, you will need to lodge a finalisation event as your chosen end-of-year method. You must not generate payment summaries/payment summary annual report (PSAR) as you overstate your payroll data to the ATO. In fact, the platform will not allow you to generate payment summaries as it recognises that you have lodged STP events throughout the financial year. 

Also, do not forget that STP events are reporting YTD payroll data. So if, for example, a business only started reporting STP in March, but was processing payments in this payroll classic from the start of the financial year. The first STP event lodged will have already included the YTD payroll data for each employee included in that event. It means that you captured all payroll data from 1st July for the employee in the first event lodged.

What you need to be aware of, though, is that pay events only include employees paid in the pay run that you have lodged. There may be some employees paid from the start of the financial year who you have not paid since the business started lodging via STP. To make sure you capture all employee data, create and lodge an update event before completing the finalisation event. The update event will capture all employees paid in the financial year, who have not been marked as final in an event. Once completed, you will then be able to process your finalisation event. 

If you are a WPN holder and are not using a registered agent for ATO reporting, you must generate payment summaries. The reason for this is that the ATO does not support electronic lodgement for WPN holders.

Otherwise, WPN holders using the services of a registered agent can process an STP finalisation event instead of generating payment summaries. For all other business scenarios, you can definitely process an STP finalisation event instead of generating payment summaries. 

If you fall within any of the above business scenarios that allow you to lodge an STP finalisation event, you must complete the following steps to make sure you lodge the event with the ATO:

• If you have not already done so, you will need to enable STP. Pay particular attention to the instructions on the ATO integration and make sure you have notified the ATO of the software ID for your business.
• Once the above is complete, lodge an STP pay event for the last pay run processed in the financial year. If you have multiple pay schedules set up in the business, make sure you lodge a pay event per pay schedule. The reason for this step is that the ATO requires you to lodge a pay event successfully lodged before lodging any finalisation event. If you do not lodge a pay event first, you will see a validation warning in the finalisation event that will prevent you from lodging the event.
• Once you have successfully lodged the pay event, you can create an STP finalisation event. Refer to our STP End of Year Guide for detailed instructions on completing year end processes via STP.

So the first thing that needs to be considered here is whether the business was reporting via STP in the previous payroll classic. 

Scenario 1: Business was reporting via STP in the previous payroll classic

If this is the case, you need to make sure that the final STP event lodged in the previous payroll classic included the terminated employees and those terminated employees you marked as is final. Doing this acts as an indicator to the ATO that there are no further payments you need to make for that employee for the rest of the financial year.

If that occurred in the previous payroll classic, then there is nothing further required for you to do for the terminated employees, as the finalisation declaration for the financial year already occurred in the previous payroll classic.

If you have not done this, then you will need to complete a finalisation event for the terminated employees in the previous payroll classic but only for those terminated employees. If you cannot access the previous payroll classic to complete a finalisation event, then you can transfer the terminated employees to this platform and complete a finalisation event.

Scenario 2: Business was not reporting via STP in previous payroll classic

If this is the case and you only began STP reporting in this payroll platform, then there are a few ways to deal with this:

Option one

If you are an STP-exempt business, keep the terminated employee data in the previous payroll classic and generate payment summaries for those employees. If you are not exempt from STP, you must report employees via STP.

Option two

If you are not a WPN holder, add terminated employee data in this payroll classic and enter their YTD data via the Opening Balances feature, so that they are then included in the finalisation event.

Option three

If you are a WPN holder not reporting via STP, add terminated employee data in this payroll classic and enter their YTD data via the Opening Balances feature. You will then be able to generate payment summaries/PSAR for the terminated employees. 

The short answer is no. As you started reporting successfully via STP during the financial year, you now need to see it through to the end and complete an STP finalisation event. The platform will not allow you to generate payment summaries as it recognises that you have lodged STP events for those employees. Refer to our STP End of Year Guide for instructions on how to complete the finalisation process.   

There are so many variables with this topic and different scenarios that need to be considered here. If we have not discussed your exact scenario above, please refer to this article to get a better understanding and resolution to your specific situation.

You will need to issue the payment summary to them in person or post it to them. On the Payment Summaries page in the Reports module, you can print the payment summaries once published. To do this in bulk, click the Download button and select the PDF option from the top menu.

It will download all the payment summaries and employment termination payment summaries in PDF so you can then print them. Alternatively, if you only want to print a payment summary for a specific employee, click the Actions button and then the Download button.

The only scenario where you cannot publish a payment summary is when you have not fixed a validation warnings. We have enforced this practise of not being able to publish payment summaries in these instances to avoid failed lodgements with the ATO. You will know there is a validation error for an employee in two sections , only after you have clicked the Show Payment Summaries button:

1. We display a    in the Status column for that employee; and
2. A Warnings tab will appear on the Payment Summaries page.

Clicking on the Warnings tab will show you the exact issue for the employee. Once rectified you can click on 'Show Payment Summaries' again to refresh the data and then publish the payment summary.

We have introduced a wizard to help guide you through enabling STP for your business. You can find here detailed instructions on how to complete the wizard.

Part of enabling STP involves connecting your payroll software to the ATO. Simply completing the wizard does not activate that connection. Rather, you must complete steps outside the wizard to make sure the connection is set up correctly. 

Introducing STP Phase two has brought about a focus on the disaggregation of gross income. The ATO has stipulated that you should separately itemise payment types when reporting, so it is important to classify correctly. Once you publish the payment summaries and before you report through STP, you should make sure you assign all of your pay categories to the correct payment classification.

As part of STP Phase 2, we have added a lot of new classifications to categorise the deduction types, so it is important to make sure your deduction categories have been classified correctly.

This article has more information on the deduction categories available. There have also been two Salary Sacrifice classifications introduced as part of STP Phase 2:

Salary sacrifice (superannuation):

It refers to an effective salary sacrifice arrangement entered into before the work is performed, where contributions are paid to a complying superannuation fund and whereby the sacrificed salary is permanently foregone.

Salary sacrifice (other employee benefits):

It refers to an effective salary sacrifice arrangement, entered before they perform the work for benefits other than for superannuation and where the sacrificed salary is permanently foregone. Examples include:

• Novated lease.
• Gym membership.
• Workplace giving donations.
• Car.
• Property (goods, land, buildings, shares and bonds).
• Expense payments (loans, school fees, childcare costs and home phone costs).
• Work-related items, such as portable electronic devices and equipment.

If you have made salary sacrifice arrangements where the contributions are paid to a super fund, we strongly recommend using the platform default deduction category for Salary Sacrifice Super. Alternatively, if the salary sacrifice arrangements are for benefits aside from superannuation, please ensure to use the Salary sacrifice (other employee benefits) classification

The decision is yours to make. You can register for STP and begin lodging STP events for the 2022/23 financial year before publishing/lodging payment summaries for this financial year, or you can wait till after you have lodged the payment summaries.

The important thing to note is that the ATO has strict deadlines for reporting STP; this requirement excludes closely held reporting where the employer can choose to report quarterly. You can access here further details on closely held reporting obligations). The ATO stipulates: 

"You are required to report a pay event to the ATO by the pay day. The pay day is either the payment date stipulated in the electronic transaction to your financial institution or, if you did not stipulate a date for payment, the date you intend to make the payment into your employee's bank account."

You really need to assess your pay frequencies, and when the first pay date for the new financial year kicks in. If this is before when you plan on publishing payment summaries for the 2021/22 financial year then you really should register for STP before your first pay date.