As a business owner, staying up-to-date with payroll changes is essential to avoid compliance issues, penalties, and unnecessary costs. Here are the key payroll updates businesses need to prepare for:
- Wage Theft Laws (Effective from 1 January 2025)
Under the new laws, underpaying wages is now considered a criminal offence, with severe penalties for businesses that intentionally underpay their employees.
- Right to Disconnect (From 26 August 2024 for large businesses and 26 August 2025 for small businesses)
Employees will have the right to ignore after-hours work communication unless it is urgent. This new law ensures employees are not expected to be available outside of their regular work hours.
- ATO GST Reporting Update (From 1 April 2025)
Around 3,500 small businesses with a history of late lodgement, non-payment, or incorrect GST reporting will be moved from quarterly to monthly GST reporting. Affected businesses need to review their bookkeeping systems and workflows to ensure compliance with the new reporting schedule.
- Superannuation on Parental Leave (From 1 July 2025)
Parental leave payments will include superannuation for eligible employees, helping to boost retirement savings during a time of leave.
- Payday Super (From 1 July 2026)
Superannuation must be paid with wages, rather than quarterly, ensuring employees receive their super contributions more frequently.
- Casual Employment Reforms (From 26 August 2024)
Casual employees who meet certain conditions must be offered permanent employment. Businesses should review casual contracts and ensure they comply with the new regulations.
What Does This Mean for Your Business?
These changes highlight the importance of reviewing your contracts, payroll software, and reporting processes. Make sure to act now to ensure your business complies with the new laws.
6 Payroll Mistakes That Cost Businesses Time and Money
Avoiding these payroll mistakes is crucial to prevent delays, penalties, and financial headaches:
- Missing Superannuation & Payroll Tax Updates
The superannuation rate will increase to 12% from 1 July 2025, and payroll tax thresholds vary by state. Businesses must update payroll systems to reflect these changes and avoid penalties. - Errors in Payroll Reporting & STP Submissions
Incorrect employee details, duplicated payroll entries, or missing adjustments can lead to ATO compliance issues. Regularly review payroll reports and keep software updated to avoid errors. - Misclassifying Employees & Incorrect Wage Payments
With new casual employment laws effective from 26 August 2024, businesses must review contracts and ensure employees are correctly classified. Misclassifying workers can lead to backpay claims, disputes, and penalties. - Late or Incorrect Employee Payments
Payroll delays or incorrect payslips lead to employee dissatisfaction, legal issues, and Fair Work claims. Ensure wages, overtime, bonuses, and super contributions are processed accurately and on time. - Failing to Secure Payroll Data
Payroll data is a prime target for cyber threats. Implement multi-factor authentication, data encryption, and security audits to protect sensitive information. - Incorrect Termination & Redundancy Payments
Final pay must include all accrued leave and redundancy payouts. Mistakes in termination payments can lead to disputes, fines, and Fair Work investigations.
Important EOFY Payroll Deadlines for Businesses in 2025
To avoid penalties, ensure you’re aware of key payroll deadlines:
- Super Guarantee Rate: Increases to 12% from 1 July 2025. Update your payroll settings to reflect this change.
- Superannuation Guarantee Contributions: Must be received by employees’ super funds by the quarterly due dates (28th of each month following the end of the quarter).
- BAS (Business Activity Statement):
- Monthly BAS: Due 21st of the following month.
- Quarterly BAS: Due 28th of the month following the quarter (i.e. July, October, February, and April).
- Monthly GST Reporting: If you’ve been notified by the ATO, businesses may now need to lodge GST monthly from 1 April 2025.
- Annual Payroll Reconciliation: Complete by 14 July.
- Single Touch Payroll (STP) Reporting: Must be submitted each payday or at the latest, on the day of payment.
- PAYG Withholding: Reported and paid by the 21st of the following month.
- Award and Wage Changes: Effective from 1 July, so ensure payroll systems are updated.
FAQ:
Q: What is wage theft, and how can I avoid it?
A: Wage theft refers to intentionally underpaying employees. To avoid it, ensure your payroll system is up-to-date with correct wages, entitlements, and superannuation contributions. Regularly audit your payroll and ensure compliance with minimum wage laws.
Q: How will the ATO GST reporting update affect my business?
A: Businesses with a history of late lodgements or incorrect GST reporting will be moved from quarterly to monthly GST reporting. Ensure your bookkeeping system is adjusted to accommodate this change, so you can meet the new deadlines.
Q: What happens if I miss the EOFY payroll deadlines?
A: Missing EOFY payroll deadlines can result in penalties and fines. Make sure to submit BAS, STP, and superannuation payments on time, and keep track of any changes to tax rates and superannuation contributions.
Q: Do I need to update payroll systems for the superannuation rate increase?
A: Yes. The superannuation rate increases to 12% from 1 July 2025. Ensure your payroll system reflects this change to avoid underpayments.
Conclusion
In 2025, significant payroll changes will affect businesses, from new wage theft laws to updates in GST reporting and superannuation. It’s crucial for business owners to stay ahead of these changes by reviewing contracts, updating payroll systems, and meeting all necessary deadlines. By avoiding common payroll mistakes and staying compliant with new regulations, you can ensure your business remains on track and avoids costly penalties. If you’re unsure about how these changes impact your business, it’s advisable to seek professional advice to ensure full compliance.
—————BOOK YOUR EXCLUSIVE 15 MINUTE ZOOM CONSULTATION————-
We offer a 15-minute no obligation consultation to existing property investors, first home buyers and small business owners who are looking at property investments, business and asset protection. To Book an Appointment simply click here and pick a time and date.
BOOK YOUR ZOOM APPOINTMENT HERE
How can we help?
If you have any questions or would like further information, please feel free to give our office on 08 9221 5522 or via email – info@camdenprofessionals.com.au or arrange a time for a meeting so we can discuss your requirements in more detail.
How can we help?
If you have any questions or would like further information, please feel free to give our office on 08 9221 5522 or via email – info@camdenprofessionals.com.au or arrange a time for a meeting so we can discuss your requirements in more detail.
General Advice Warning
The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.
Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.
Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals, its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.
Recent Comments