Payday Super and contractors: key issues for employers
Client AlertPayday Super and contractors: key issues, payment timing risks and SG obligations for employers.
Expert-led tax essentials delivering practical insights and strategic foresight. Learn more.
Companies with Employee Share Schemes (ESS) are required to report to the ATO and provide employees with a statement if a ‘taxing point’ has occurred during the tax year. Furthermore, employers operating start-up plans are also required to report to the ATO the grants made within the year.
You must provide an ESS statement to employees by 15 July 2024, and the ESS annual report to the ATO by 14 August 2024. This presents a significant amount of pressure on employers looking to provide ESS statements in a timely manner, with taxing points arising right up to 30 June in some cases.
As well as the complexity of the reporting itself, which requires ATO compliant software not ordinarily integrated with businesses payroll solution, below are some of the issues we are seeing in the market highlighting the particular complexity of ESS:
Given the significant complexity, time pressure and associated risks that can be involved, we recommend that you engage with Employment Solutions advisors to review your plans and ensure you are accurately meeting your ESS reporting requirements.
Most employers will be aware of the upcoming payroll tax lodgements. The annual return generally must be lodged by 21 July each year but may vary, such as in New South Wales and South Australia, where it must be lodged by 29th July. However, with the constantly evolving and increasingly active State Revenue Offices, the lodgement date itself should only form part of employers’ consideration. We set out below some of the common issues identified in subsequent audits:
The above are just some of the issues that have arisen during recent audits and reviews. Given the significant level of activity aided by more sophisticated data matching techniques, we recommend that a robust state payroll tax review becomes part of all businesses’ broader tax governance process.
Taxable Payments Annual Report (“TPAR”) is often overlooked ahead of other tax obligations (income tax, indirect tax, and employment taxes, amongst other tax matters) however it should be on the radar of businesses, especially those who fall under the definition of a Significant Global Entity.
Annual TPAR lodgements are due by 28 August every year. If you engage contractors (including subcontractors, consultants, and independent contractors) and your business provides any of following services, you could be required to comply with Taxable Payments reporting system and lodge a TPAR:
Considering the breadth of the Taxable Payments reporting system requirements, not only businesses that primarily offer services in the above industries have reporting requirements. For instance, for retailers and restaurants that rely on courier services for deliveries, this service has become central to their business model. They may therefore have inadvertently given rise to reporting requirements.
As such, if your business provides services in any of the industries above but are uncertain if you are required to lodge a TPAR we can assist with the determination of your TPAR obligations. Additionally, Grant Thornton have an in-house tool to assist with the lodgement of TPAR, without the requirement to complete forms and manual entry. Contact a member of our Employment Solutions team, or your local tax contact, for assistance.
Payday Super and contractors: key issues, payment timing risks and SG obligations for employers.
Payday Super regulations explained: how the new administrative uplift works and what employers must do next
Payday Super PCG 2026/1: key changes, compliance approach, employer readiness