Your payroll administration is not something that should be taken lightly – it is an important part of business, an action that compensates your hard-working employees. You need to ensure that it is accurate and compliant. You must make sure you’re making the best decision for your business by considering the questions below.
It is easy to get confused between an outsourced payroll service and software, both use software making it appear that the two are similar. Software is much like the possession of a pair of scissors, which will allow you to cut someone’s hair, engaging an outsourced payroll provider is the experience and expertise that will give you the satisfactory result that you require. Payroll is subject to numerous changes, at least yearly, and is never something that you can ‘set and forget’. Claims that software is smart enough that you don’t need to worry are mischievous at best and blatant lies at worst. Ask yourself what happens when we have problem, who is there to help?
Ensure your processing expertise is locally based, not offshore. It is important to make sure you have access to assistance when you need it – find out what the turnaround times are like for questions. It is imperative you stay in control of your payroll data, be very cautious of sending you and your employee data to overseas providers. Some providers implement locally, then ship your relationship overseas, make sure you are sure of the service you are getting.
Do you want to risk having your payroll overhead left in the hands of an immature business? Sure, they can quote how much experience their staff have but is that a true measure of their expertise? Ensure that your provider not only knows payroll but that they know how to process large quantities of payrolls from all types of industries.
Don’t risk issues by using antiquated technology. It is universally accepted that cloud technology is the way forward in today’s world, ensuring access wherever and whenever you need it.
Many new providers of outsourced services are using generic software and spending their time marketing the same mediocre product that many other payroll providers have. This means you have no control over their costs or proficiency. These providers only attract clients through means of slick marketing spin or discounting below cost; either way, it often ends badly. Solutions like PaysOnline means custom-built software; backed by a team of payroll experts and a development team adding additional layers of flexibility and security.
You don’t want your payroll provider to become a single point of failure for your payroll process. Multiple staff should be overseeing your pay process from your provider at all times.
Lower margins and extensive competition from discounters has seen the emergence of a disturbing trend. Many services cut the costs charged for processing by obtaining third parties incentives; this means giving access to your employee’s data via tools contained in the HR suite like employee self-service. Offers of finance, superannuation investments, insurance and many other services are all being presented under the guise of lifestyle choices for your employees. Most have commissions and kickbacks associated with them, suggesting that it may not always be the best for everyone concerned.
In an age where more and more of our personal data is being stored online, it is imperative that your provider has, at a minimum, ISO 27001 certification for information and data security. The ATO have legislated that all business with more than 10 thousand employees under management must have this accreditation. Smaller businesses may be exempt, but the risk of data and security breaches are obviously higher. You must assess your risk appetite for data potential breaches.
If your new provider is sure that you will enjoy a win-win situation for you with the services that they provide they should offer you a guarantee on your satisfaction; no questions asked. Even when you are satisfied you should not tie yourself into a processing agreement longer than 12 months.
Don’t settle for a provider who cannot seamlessly expand to cater for an increase in your employee growth. A reliable provider will be able to cater for your business growth without the need to introduce other software or systems.
You should, as a rule, never let a provider have your money in ESCROW (a financial arrangement where a third party holds and regulates the payment of funds for two parties in a given transfer) for the payment of any wage liability. If necessary, it should be only for the clearing periods necessitated by the banks. Full trust accounting should be available. In Australia the provider should be authorised to, or act as a representative for an Australian Financial Services License (AFSL) holder.
Any organisation dealing with Tax, Superannuation and Single Touch Payroll (STP) in Australia is required to be a member of the Tax practitioners board. Ensure that your provider is, as it affords you the protection that you are entitled.
Changing from one payroll method to another won’t help if you aren’t interested in changing the in-house management systems, attitudes and behavior. In order to attain best practice, you should be sure that your outsourced provider is able to take you through the steps required to ensure industry leading best practice.
It is easy to get swept away by big corporates with big sales and marketing budgets. Make sure you can quantify the “spin” over actual capability and ensure you’re sold on the product and service rather than the brand and a slick sales process.
Creating your own bespoke payroll services is a sure-fire way to an ensure an inefficient system by stitching together, a series of systems or providers. All employee onboarding, payroll processing, employee self-service, rostering, timekeeping, attendance, biometric devices and HR solutions should draw data from a single data source. Anything less, introduces the potential for inefficiency and system failure.
Payment of superannuation should occur faultlessly and seamlessly as part of the payroll process, without the ability to download and manually intervene with files. You should always ensure that superannuation payments are being made to the funds details that are provided by the ATO. You should always ensure your provider is suitably qualified and have an AFSL (Australian Financial Services License) to transfer the information and the funds if required through a SuperStream authorised gateway.
It happens, for all manner of reason you may need look for another provider or method to process your payroll. Will you have continued access to your payroll records after you decide to leave? Do not engage with a provider that will not allow you continued access to your records after you terminate. You are required in Australia to have access to your record for payroll for at least 7 years. You should not ever feel pressured to stay with a provider because of the information that they hold.
The Australian Taxation Office has announced that any unreported cash in hand payments made to workers from the 1 July 2019 will not be tax deductible.
In addition, any payments made to a contractor who has not provided an ABN and does not withhold tax will also not be tax deductible from 1 July.
Matthew Addison, an executive chair for the Institute of Certified Bookkeepers said that the “focus does not mean cash payments are no longer allowed but is rather about unreported payments.”
“If it is for wages then PAYG must be considered and super must be considered but you are allowed to pay in cash, as long as it is reported according to the law,” said Addison.
“The issue is about unreported cash payments. If you don’t withhold when you should, and if you don’t report when you should then no deduction.”
PaysOnline’s outsourced payroll system can help you remain compliant. Contact us today for a tailored solution for your business.
Cybercrime is something that should be taken seriously, particularly in businesses that handle important and personal data. As the internet becomes easier to access and we begin sharing more information online it is integral to have security measures in place, for many this includes the data your business creates and store, plus the information your customers share.
Steve Ingram, an Asia Pacific Cyber Lead at PWC describes in their 2018 report that while “technology has been an agent for us improving the efficiency of our economy.” It has also become a “great tool for organised crime” with criminals using technology to steal identities and use the information in a fraudulent manner.
The data from the PWC’s report presents a picture of Australian companies engaged in a constant struggle to prevent data breach attacks. It’s a “neck and neck race,” Steve Ingram commented. “The thing with crime is that you rarely get ahead of the curve. You have to keep pace. There’s no end game here. We just need to be forever vigilant.”
David Simmon in his article, “Are Businesses taking the threat of cybercrime seriously?” echoes the sentiment, showcasing how the recent attacks on sites including Princess Polly, Canva and Kathmandu are just a few prime examples of how businesses keep falling victim to these sophisticated cybercriminals exploiting vulnerabilities in digital systems.
Businesses need to consider how being victims of cybercrimes can negatively affect their reputation and the immediate effect of losing customer trust and revenue. At PaysOnline, data security is a number one priority. With access to you and your employees personal data, we believe it’s integral to take every step available to secure your most valuable information; as such, we have become ISO 27001 certified for Information and Data Security.
Business News Australia believes cybercrime will cost the world in excess of US$6 trillion annually by 2021, up from US$3 trillion in 2015. So, considering all the detrimental effects of cybercrime, are businesses taking the threat of cybercrime seriously? Apparently not.
According to the board director of international IT governance association ISACA Greg Touhill cybercrimes are being vastly underreported but growing in volume.
“Underreporting cybercrime even when disclosure is legally mandated appears to be the norm, which is a significant concern,” says Touhill, referencing the ‘2019 State of Cybersecurity Study’ commissioned by ISACA.
“Half of all survey respondents believe most enterprises underreport cybercrime, even when it is required to do so.”
According to an ASACA Report, the top three threat factors are cybercriminals, hackers and non-malicious insiders and Refinitiv details that, “almost 75 per cent of Asia Pacific organisations have been the victims of financial crime over the past 12 months.
This high rate is due to a lax approach to due diligence checks when onboarding new customers, suppliers, and partners.
New vulnerabilities arise every day and can often prove extremely difficult for those who don’t know, or spend time researching about cyber security. Cybersecurity and it’s blind spots are very important to be aware of if your business is going to survive in this technologically progressive environment. No one is immune to cyber security, so taking the steps to prevent it and stay one step ahead is key. PaysOnline take the responsibility of handling your most personal information extremely seriously.
Contact us today for a tailored and secure payroll system.
With tax time fast approaching, Australians can expect letters from the Australian Taxation Office, as they focus on closing the $8.7 million tax gap. Dodgy claims including dry cleaning and car expenses will once again be closely monitored, along with investment property deductions and earnings from cryptocurrencies and sharing economy platforms such as Uber.
H&R Block’s director of tax communications, Mark Chapman believes that the intensity of focus (from the ATO) is going to be different this year.
“The ATO has been given additional resourcing by the Government to back up the work they’re doing in relation to noncompliance. I think we’ll see far more audits and more letters in relation to incorrect claims around work-related expenses and property, and we’ll see far more data-matching around cryptocurrency and the sharing economy.”
Last tax time, thousands of Australians received letters as claims were flagged as unusual, or by the ATO discovering undeclared income.
“An audit is really just one component,” Chapman said. “They do a lot of investigation in this space through technology – they data-match, they have benchmarks, if expenses are outside the norm people will get a letter which is not a full audit, it invites them to think again.”
Figures of deliberate attempts to over-claim can attract penalties of up to 75 per cent of the claim.
Work expenses to watch
Find more information on deductions you can claim for here
To see how an outsourced payroll solution can streamline your payroll process, contact PaysOnline today.
The PaysOnline team are constantly endeavouring to further streamline the payroll experience for our clients, this is why we are excited to announce the release of a highly requested feature – separation certificates.
A terminated employee may ask you to provide them with a separation certificate. When a person claims income support, the Government Department of Human Services uses the separation certificate to ensure that their customers are being paid the right amount from the correct date.
Rather than having to collate data, print the form and then fill it out manually – PaysOnline’s digitised Separation Certificate populates the fields with the data stored within the system. This means all you have to do is fill out any outstanding fields, download and print, and then sign the form.
To gain access to this feature you will need to contact your payroll manager who will switch it on for you. Once enabled, you can then go into any terminated employee record and fill out the certificate.
For more information, or to see how PaysOnline can streamline your payroll processes – contact us today.
A Queensland electrical contracting company and it’s director have been penalised $40,000 for ignoring a Fair Work Commission order to compensate an employee who was unfairly dismissed, following action by the Fair Work Ombudsman.
Unfair dismissal, as described on the the Fair Work Ombudsman website, is when an employee is dismissed from their job in a manner deemed harsh, unjust or unreasonable. To apply for unfair dismissal, employees must apply to the Commission within the first 21 days of the dismissal taking effect. If you think you have been unfairly dismissed, you need to contact the Commission as soon as possible.
The Federal Circuit Court charged the employer, Logan City Electrical Division Pty Ltd $32,760. The company’s sole director Peter Burnitt was also charged a further $6,552. The penalty was ordered after the termination of a 26 year old refrigerator and air conditioner mechanic in 2017 after five years of employment.
An order to pay the employee $19,640 and 9.5% commission has set in 2017, however this was not paid to the employee prompting assistance from the Fair Work Commission.
Fair Work Ombudsman Sandra Parker said that ignoring order of the Fair Work Commission is not an option.
“The Fair Work ombudsman has secured penalties against several employers for failing to pay unfair dismissal compensation ordered by the Fair Work Commission,” Ms Parker said.
“It is fundamental to the integrity of the workplace relations system that commission orders are enforced and we will take court action, particularly when they involve compensation for vulnerable employees,” Ms Parker said.
Employers and employees can seek assistance at www.fairwork.gov.au or contact the Fair Work Infoline on 13 13 94.
The Australian Tax Office (ATO) is cracking down on popular car-related claims this tax time and aims to capture the activity of businesses and their employees.
The ATO describes Fringe Benefit Tax (FBT) as “a tax paid by employers on certain benefits they provide their employees or their employees’ family or other associates. FBT applies even if the benefit is provided by a third party under an arrangement with the employer.” There are various types of fringe benefits including car, housing, entertainment and many more – you can find more information for each specific fringe benefit here. This coming tax time car-related claims will be at the top of the ATO’s watch list.
Claims that use non-commercial parking rates and a lack of evidence to support the calculated rates will raise a red flag. Essentially, claims that seem too high and aren’t backed up by receipts are in the ATO’s sight.
The Tax Office already warned last year in it’s Practical Compliance Guidelines that they were set to target car-related expenses.
“This law has always been about minor, infrequent travel for work vehicles, but this [guidance] puts the onus very much on the employer to prove that work cars are not used as a perk to retain and attract staff,” said Pilot Partners tax specialist Murray Howlett at the time.
“The ATO is delivering a clear warning to employers to make sure they have a policy on work-related travel and to make sure they enforce it,” he said.
“The increasing sophistication of the ATO’s tracking methods will mean that there will be many employers out there who are at risk of an unforeseen tax bill,” he said.
“It will create an uneven playing field and one that is going to mean a big mind shift for employers who, for many years, have turned a blind eye to FBT,” he said.
Other claims that will be closely monitored will be those related to entertainment expenses as a deduction but not correctly reporting them as a fringe benefit, or incorrectly classifying entertainment expenses as sponsorship or advertising.
For more information on how to lodge your tax return you can head over to the Australian Taxation Office by following this link.
What Does the 2019 Federal Budget Mean for Superannuation
On Tuesday 2 April 2019, the Federal Government handed down its Budget for the 2019/20 financial year and we once again see changes to superannuation. The proposal is set to take effect from 2020-21 and is broadly positive in nature, aiming to increase contribution opportunities for those individuals aged between 65 and 74.
Work test exemption for individuals aged 65 and 66
The government has stated that from 1 July 2020 those aged 65 and 66 will be able to make voluntary super contributions without satisfying the work test requirement. The work test requires those aged 65 and above to have worked a minimum of 40 hours in a consecutive 30 day period.
Extension of the Bring-Forward rule
The government also announced that they will extend access to the ‘bring-forward’ arrangements, which currently allow those aged less than 65 to make 3 years worth of non-concessional contributions, which are capped at $100,000, to their super in a single year. This will now be extended to people aged 65 and 66.
What this could mean for you
Currently, you must be under 65 during a financial year to use the bring-forward rule. This change enables 66 and 67 year old‘s to boost their super in preparation for retirement, provided they meet other eligibility criteria. This change complements the work test exemption changes and is also stated to apply from 1 July 2020.
Extension of age limit for spouse contributions
The proposed changes also see that individuals will be able to contribute to their spouse’s superannuation where the receiving spouse is under the age of 75. The work test will continue to apply if the receiving spouse is aged 67 or over, however 65 or 66 they won’t have to meet this obligation.
What this could mean for you
Currently, to make a spouse contribution, your partner must be under the age of 70 at the time of the contribution, and must meet the work test if they are aged between 65 and 69. This change enables you to make spouse contributions for a further five years, giving you more opportunities to equalise your superannuation balances while potentially claiming a tax offset.
You can find out more about the Federal Budget for 2019/2020 here
To see how PaysOnline can help streamline your payroll processes, contact us today!
Sometimes work can leave us feeling both busy and unproductive. As our workload increases and the to-do lists get longer it’s natural to feel overwhelmed and fret as to how to actually get it all done. To stay on track, it’s imperative to focus on your final goal, this way you feel your time is being spent most productively.
Below are a few things to consider on your path to increased productivity.
Get sleep & Get moving!
Getting a good nights sleep, working on something you love or taking some time to exercise can help leave you feeling energised – we are much more productive when we feel good in ourselves. Taking the time to learn and understand how the body works differently throughout the day can help you plan your tasks; scheduling your most important tasks for earlier in the day gives you the best chance possible to get it finished.
Utilise but don’t abuse technology
It is important that we don’t let technology and device use take over our lives. Taking a few moments to read through emails or flag tasks for the day can help you feel more at ease to continue on your day in a productive manner.
Multitasking – is it actually efficient?
When we multitask we tend to make more mistakes than usual. Moving back and forth from task to task your brain has to backtrack to try and figure out where it left off and pick up on it again. Choose one task to focus on and work through it – you’ll get more done this way.
It’s important to think quality over quantity. If you know you need a full day to complete a certain task allocate a day to complete all of your other smaller tasks that don’t require as much time. This way you can look at your week and see say, “Monday was productive because I cleared time to do this bigger task on Tuesday”.
Learn to say no
It is perfectly okay to be selective on how you wish to spend your time and to not overload yourself with various different tasks. Choose tasks that contribute to your overall goals and focus your energy on those.
Distractions happen – so forgive yourself if you do happen to get a little sidetracked. By focusing on one task at a time and trying to ignore distractions, the more we exercise the evolved part of our brain, making it easier to focus.
The Australian Payroll Association recently put together an article outlining a new way that fraudsters are attempting to infiltrate payroll departments in order to receive money they’re not entitled to.
Two staff members at the Australian Payroll Association advised of a scam happening to them within the past week. In the article, “New way to attempt payroll fraud” (2019) it details how the scam works, with “perpetrators having a copy of the email signature of a manager with financial authority or an employee. They send an email that looks exactly like it has genuinely come from that person in the pay office. They typically request making a bank account change for an employee or ask to have an immediate funds transfer made to a certain bank account.” It is instances such as this that highlight just how easy it is for people to put trust in and action emails without asking any questions.
As a fully managed and secure payroll system, PaysOnline have planned for scenarios such as this, developing and utilising a secure messaging centre and employee self-service portal. This takes the stress of potential error or interception off your shoulders, enabling you to focus on the more important aspects of your business.
Listed below are a few ways in which PaysOnline are protecting your important information from payroll fraud.
It is important to be vigilant when it comes to subjects such as payroll fraud and to keep on eye on what content you might be exposing. To see how PaysOnline can help you mitigate the chances of payroll fraud, contact us for a quote today.