Top 6 Payroll Processing Tips for Accountants in Australia

Payroll is more than just paying employees—it involves tax compliance, superannuation obligations, and accurate reporting. Mistakes can lead to ATO penalties, legal risks, and unhappy employees. So, how can accountants streamline payroll processing while staying compliant with ever-changing regulations?

Here are six essential payroll tips to help accountants manage payroll efficiently in 2025.

1. Stay Updated on Payroll Compliance

With frequent updates to minimum wages, Fair Work regulations, and tax laws, staying compliant is a challenge.

✔ Regularly check the Fair Work Ombudsman website for wage updates.
✔ Ensure employees receive the correct tax and super contributions.
✔ Use ATO-compliant payroll software to stay up to date automatically.

2. Master Single Touch Payroll (STP) Reporting

STP reporting is mandatory for Australian businesses. Every payroll cycle, businesses must report wages, PAYG withholding, and super contributions to the ATO.

✔ Use STP-enabled payroll software for automated reporting.
✔ Double-check tax and super calculations before submission.
✔ Reconcile payroll monthly to avoid EOFY surprises.

3. Get Superannuation & Payroll Tax Right

Super contributions (11% in 2024) must be paid on time to avoid penalties. Payroll tax also varies by state, requiring careful tracking.

✔ Pay super contributions before quarterly deadlines.
✔ Use payroll software that flags errors.
✔ Monitor payroll tax thresholds for different states.

4. Correctly Classify Employees & Manage Leave

Misclassifying employees as contractors can lead to major compliance issues. Similarly, incorrect leave tracking can create disputes.

✔ Follow ATO guidelines for employee vs. contractor classification.
✔ Accurately track leave entitlements, overtime, and penalty rates.
✔ Ensure compliance with Modern Awards.

5. Use ATO-Compliant Payroll Software

Manual payroll processing is risky. The right payroll software simplifies compliance and reduces errors.

✔ ATO-compliant & STP-enabled software is essential.
✔ Automates tax & super calculations.
✔ Integrates with Xero, MYOB, and QuickBooks.

 6. Plan for Payroll Year-End Processing

EOFY is stressful, but good planning makes it easier.

✔ Reconcile all payroll transactions before June 30.
✔ Ensure STP reports are submitted by July 14.
✔ Issue payment summaries if required.

Final Thoughts

Payroll compliance doesn’t have to be overwhelming. By following these six payroll processing tips, accountants can reduce errors, improve efficiency, and stay compliant.

Want a detailed breakdown of each tip? Read the full article  Click here. 

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