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Taking the stress out of new super obligations

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech).

Employers who don’t pay employees their full superannuation entitlements will face stiffer penalties under proposed federal laws, making it crucial for employers to get their payments systems right to ensure timely payments – and new payments technology can make this task much easier.

Businesses will be given a 12-month amnesty to pay workers any unpaid superannuation guarantee (SG) payments or face harsher penalties under a Bill the Federal Government has recently introduced into Parliament.

Under the proposed legislation, to use the amnesty, employers must pay all the SG that is owing to their employees, including interest. The amnesty will make it easier for employers to pay outstanding employee entitlements as the Federal Government will set aside penalties for late payment that are normally paid by employers.

Employers that do not take advantage of the one-off amnesty will face steeper penalties when they are subsequently caught – in general, a minimum 50 per cent on top of the superannuation they owe workers. Throughout the amnesty period, the ATO will continue its usual enforcement activity against employers for those historical obligations they don’t own up to voluntarily.

The Bill will also require superannuation funds to report ​employer contributions at least monthly to the ATO, allowing for the earlier identification of non-payment. Fraudulent businesses that deny workers their superannuation will find it harder to avoid getting caught.

The proposed new measures are welcome, and they are needed. The ATO has previously estimated that in 2014-15, around $2.85 billion in SG payments went unpaid. While that represented a 95 per cent compliance rate, any level of non-compliance is unacceptable as it is tantamount to wage theft, which is why the Government has given the ATO the resources it needs to enforce compliance.

Technology can help

New technology can help employers pay their workers their full superannuation entitlements on time.

InPayTech’s system, PayVu, significantly speeds up the payment of superannuation to the same day and reports these payments to the ATO via Single Touch Payroll (STP) as they are made.

For employers with 20 or more employees, STP reporting of SG payment information will be mandatory from 1 July 2018.  STP streamlines the way employers report tax and superannuation information to the ATO, which will be able to track which employers are paying the right amount of superannuation – and which ones are not.

Importantly, PayVu removes the payment delay incurred when an employer uses a clearing house to pay SG. When paying superannuation via a clearing house, an average of 4.2 days elapses between the money leaving the employer’s account and arriving at the superannuation fund’s account. PayVu payments are transferred the same day. The notion of ‘member direct’ payments is a crucial element to increasing the transparency and efficiency into the way salaries and superannuation are paid.

STP processing and the PayVu technology will also go a long way to avoiding superannuation payments getting lost in the system. If payments get sent to wrong accounts, PayVu will help to get the refund sent directly to employers, not a clearing house, from where it can be re-contributed into employees’ accounts, where it belongs immediately.

Quicker payment of superannuation will benefit employees as they can start earning returns on their money more quickly. As it is now, the refund can end up sitting in clearing houses’ accounts for an indeterminate time, and clearing houses earn interest on this – at employees’ expense.

Employers too will spend much less time administering their superannuation obligations and avoid complicated payment processes, saving valuable time and money.  If you haven’t already, as an employer you should update your payment systems to meet the ATO’s STP requirements and to ensure employees are paid their full wage and superannuation entitlements, on time, all the time, stress-free.

Automation: Opportunity or threat?

What does automation mean for accountants and bookkeepers of the future? 

By Robin Beauchamp, CEO, Integrated Payment Technologies (InPayTech).

Accounting and finance professionals not only handle money matters but business strategy and planning. That’s why many chief executives started out as accountants. They understand the importance of the bottom line and appreciate the impact of efficiency gains throughout business operations.

The role of the modern accountant and bookkeeper will inevitably progress beyond the balance sheet and ledger, to provide strategic business insights as automation replaces many of the core tasks they do. Indeed, accountants and bookkeepers are high on the list of service jobs that are being reconfigured by automation.

The flipside of automation is that it frees up time for bookkeepers and accountants to do more of the strategic thinking and business planning that organisations require. Such skills will be increasingly in demand by business leaders who will expect their staff to undertake more sophisticated roles as automation replaces their existing core activities.

That’s why accountants and bookkeepers are investing in their education, acquiring more sophisticated financial and technical skills, and improving their prospects.

According to the 2017 Bookkeeping Business Benchmark Report, conducted by the Australian Bookkeepers Network, bookkeepers are diversifying their service offerings, with a substantial increase in bookkeepers offering more services in management reporting, cash flow statements and budgeting, as well as software analysis and installation.

That has led to profit benefits, with bookkeepers lifting their charge rates in 2017 as they have offered more diverse and sophisticated services than traditional book entry, according to the 2017 report. One of these services is providing software training to clients, which is a service that 62% of bookkeepers now offer to their clients. And as more software is developed, demand for such services will likely grow. That compares to 10 years ago when software training wasn’t a core function of bookkeepers, rather of IT professionals.

So, while automation may initially seem like a threat to accountants and bookkeepers, it can in fact open other opportunities for career progression and service diversification. In this case, it has enabled bookkeepers to increase their charge rates as they diversify into more sophisticated offerings.

Software that has been launched in recent times to help bookkeepers includes PayVu, which bridges the gap between accounting, payroll and banking systems. Software such as this is good news for bookkeepers and accountants as it frees up their time for these significant value-add activities.

And this time saving is important for accountants and bookkeepers. The 2017 Bookkeeping Business Benchmark Report reveals obtaining timely and accurate data from clients and time management are the top two challenges that bookkeepers face. Automation is helping to overcome these constraints.

Marketing and sourcing new clients is another major challenge. Again, automation can help here as it will free up bookkeepers’ time to engage in business development, rather than manual book entry.

PayVu is designed for bookkeepers and accountants and can reduce the time they spend on administration. PayVu features instant display of all due payments from the client accounting system. Payments are selected and sent to business owners via their smart phone for approval or rejection.  Approved payments are immediately sent to internet banking systems and paid.

PayVu’s ability to automate all software and banking logins via secure multi-factor authentication can save a huge amount of time for bookkeepers, who, like every other person on the planet, struggle to remember their log-ins and passwords.

PayVu also links to accounting systems such as Xero and MYOB and alerts suppliers once payment has been received. PayVu updates and reconciles payments in real time to allow both bookkeepers, their clients and suppliers to avoid any delays in payments.  Payments are processed with two factor authentication security along with full straight-through-processing (STP). This means bookkeepers can stop constantly chasing clients for approvals and feedback.

PayVu is just one example of software that is making life easier for bookkeepers and accountants and freeing them up to add value elsewhere in organisations.

Seamless payroll payments technology set to be a gamechanger for Aussie bookkeepers

Revealed at the Accounting Business Expo in Sydney last week, PayVu, a digital payments initiative, has opened a new secure service for bookkeepers and accountants who struggle with periodical payments – like bills and salaries – on behalf of small business clients.

PayVu, a new digital initiative aimed at settling electronic payments on the same day will remove security concerns, allow for greater time efficiencies, and streamline communication between clients and bookkeepers.

“Bookkeepers who saw the software in action are excited that they can now effectively provide a payroll bureau service. Previously the business owner did payroll because only they could make same day salary payments,” said PayVu CEO Robin Beauchamp.

“And for accountants, the payments process is often avoided because it is such a headache chasing the business owner for on time banking approvals and other ‘administrivia’, he said.

PayVu changes that completely. “We’ve automated a process which historically has been time consuming, stressful and frustrating. Based on the positive feedback we are eager to roll this new technology out to industry and provide much needed respite for a process which has caused so much rework and stress.”

Mr Beauchamp said a pilot program was revealed at the recent Accounting Business Expo and received unanimous support from the professional community.

“As the increase of e-transfers and internet banking affects how a business runs, and with more money moving electronically, it’s often difficult to stay on top of payments,” says Mr Beauchamp.

“PayVu has consolidated this often complicated and time-consuming process by providing one integrated platform for bookkeepers and accountants to use.”

The future in payments looks exciting where integrated payroll services will serve to benefit industry by delivering a valuable service for SMEs. PayVu technology will open revenue streams to provide time critical services to bookkeepers and accountants with a more secure and streamlined approach to payment processing for their clients.

Mr Beauchamp says, “the reaction from professionals at the Expo was overwhelming, unanimous, and engaged in the future opportunities. We’re excited to be showcasing this with select businesses already and continue to receive great feedback.”

The Accounting Business Expo is Australia’s largest annual business event bringing together over 4,000 professionals. The event attracts professionals from all over Australia within the accounting sector and offers the latest industry trends, cutting-edge solutions, live demos and enhanced networking opportunities.

Single Touch Payroll (STP)

Will You Be Ready For Single Touch Payroll (STP)?

As you’re no doubt aware, the ATO is cracking down on businesses that are not paying the correct superannuation guarantee (SG) entitlement for their employees. Single Touch Payroll is one of the measures the ATO is taking to monitor employers more closely, and act accordingly when the appropriate contributions are not made.

When Will STP Start?

From 1 July 2018, all businesses with 20 or more employees will need to transition to STP. Smaller employers will be required to adopt STP from 1 July 2019.

How Will Single Touch Payroll (STP) Affect Your Business?

Currently employers can pay super monthly or quarterly with the super funds reporting the contribution data to the ATO annually.

STP requires super to be reported when each pay run has been processed. This will enable the ATO to calculate a reasonable estimate of employees’ SG entitlements and step in to require employers to pay their SG obligations if they aren’t paying the correct amounts. This will also reduce the ATO’s reliance on employees to report employer non-compliance.

The collection of superannuation contribution data through STP will also enable the ATO to display this information on the employee’s MyGov account, providing Australians with easier access to information about their superannuation via the same government platform that houses much of their taxation, medical and other records.

What Happens If A Business Breaches STP Compliance?

The Federal Government is also improving the effectiveness of the ATO’s recovery powers, including strengthening director penalty notices and using security bonds for high-risk employers, to ensure that unpaid superannuation is better collected by the ATO and paid directly to employees’ superannuation accounts.

It is expected the ATO will also have the ability to seek court-ordered penalties for employers who are repeatedly caught failing to pay their SG liabilities.

How Businesses Can Utilise PayVu To Meet STP Compliance

PayVu provides a single compliant process by automating payroll, superannuation and taxation payments and reporting those payments via STP and SuperStream, reducing the need and cost for employers to manually process wages and superannuation data via a separate payment process or gateway.

Also, with PayVu’s unique, patented technology, super contributions no longer need to pass through a clearing house before reaching the superannuation fund. PayVu automates the process of sending SuperStream payments using internet banking to transfer money to the Superannuation funds on the same day – not 4 days later! So, when you make your contributions via PayVu, you have until the actual due date to submit the payment.

How Bookkeepers Can Utilise PayVu To Help Clients Maintain STP Compliance

PayVu fully automates payroll, superannuation and taxation payments and reports these payments via STP and SuperStream. Hence, PayVu enables Bookkeepers to add a valuable Payment Bureau service to their business to manage their clients’ payments and ensure STP compliance.

What’s Coming Up…

PayVu will integrate with the New Payments Platform (NPP), which will be launched early in 2018. The NPP will enable businesses and government agencies to make faster payments, with near real-time funds availability to recipients. Payments will be data rich and fully transparent.

Regards, Robin Beauchamp, CEO