"Finalisation" replaces payment summaries
The most significant and time-saving benefit of reporting via STP is that you are no longer required to issue employee payment summaries at the end of financial year or at termination. Payment summaries have been replaced by finalisation.
At the end of the financial year, you will finalise each employee. This can be done either in your STP batch submission for the final pay of the financial year or as an extra batch submission after the final pay. Finalisation tells the ATO that you have provided all the required information for the financial year. The ATO will then pre-fill the employee's income tax return in myGov and mark it as "tax ready" for the employee or tax agent to finish and submit their return online.
Key differences between payment summaries and STP finalisation
|Payment summaries||STP finalisation|
|Reconcile several reports for the whole year||Reconcile throughout the year|
|Check for issues||Issues are resolved with each batch submission|
|Create payment summaries||Finalise employees|
|Print and issue payment summaries|
ATO pre-fills employee income tax return in myGov
|Create and submit empdupe file to ATO||No longer required|
If an employee misplaces a payment summary, you must reissue
|Employee information is always available via myGov|
When do I have to complete EOY with STP?
You must finalise your employees by 14 July each year. However, for your first year reporting via STP, the ATO has allowed additional time and so you have until 31 July 2019.