Here's how Ignition makes STP Engagement Authorisations easy
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You’ve just made it through a slew of deadlines in May and now you’ve got one month to attack the End of Financial Year. You’ve got a lot to do before June 30 rolls around. Smart practices all over Australia, just like yours, use this period to review their workflow processes, service offerings and pricing. After all, it’s a good time to take on this type of project, given that you’ll be re-engaging your clients for the new Financial Year. (p.s. we can help; Take a look.)
This year the ATO has given you another job to prepare for: Single Touch Payroll (STP). I’ll spare you the details given that you’d only be reading this because you know what STP is. What I wanted to address is the admin job that is attached to administering STP for your clients: getting an STP Engagement Authority signed by your clients. By the end of this article, I will have shown you how you can simply build the STP engagement authority into your EOFY re-engagement process for existing clients, and how PI can make your life incredibly simple for new clients onboarding into your practice.
What is an STP Engagement Authority? How will it affect my engagement process?
For the sake of brevity, I’ll let the ATO answer the first question. Their helpful website answers the who, what, and why of STP Authorities, plus the exclusions.
In my opinion the most important point is that getting a signed STP Engagement Authority is an annual obligation (“or any time there has been a significant change in the industrial relations, taxation or payroll process”). This year, you have some work to do to get all of your STP engagement authorisations from your clients, then do it all again next year, and so on. Thanks for the additional Admin, ATO!*
*To be fair, they’ve been listening. A previous iteration of the legislation required an authority for every pay event.
How do other Tax and BAS Agents get their authorisations signed?
Given that there is no pro-forma provided by the ATO, it’s up to you to draft your own. To put one together, you can reach out to your professional association for a template (or just keep reading!).
As for how, Registered agents must still obtain a signed declaration, in writing, from the employer before making the finalisation declaration on behalf of the employer at the end of the financial year.
With this being the case, most agents send a Word document or PDF as an attachment to an email. The employer would then print, sign and scan it back, or best-case scenario, use a digital signature tool.
If that was what you were planning, you’re probably thinking that this is the end of the conversation. The process is simple enough, why make a mountain out of a molehill?
Well the reality is that your Authorisations, while simple enough to send and obtain, are an important document to prove your compliance, and the process of firing off a Word doc or PDF stops short of getting the job done, and done well
What’s the problem with sending the STP Engagement Authorisation as a Word Doc/PDF?
There are several problems, actually. Let’s start with the most important one.
It’s a sh#tty customer experience.
Your clients work with you because you make their life easier. Unfortunately compliance, by its nature, can’t be skipped so it’s just one of those tasks your clients need to help you with by diligently signing on time. So let’s do the right thing and make it easy.
Sending a Word doc or PDF outsources most of the job to the client. This seems trivial but let’s look at the reality of it. You send the authorisation as an attachment they have to:
- Open the email
- Print it
- Sign it
- Scan it
- Attach it to the reply email
- Send back the email
A busy business owner has hundreds of decisions to make every single day. When confronted with this workflow, the decision to sign the authority becomes easy: “I’ll sign it later, when I’m not busy…”
A digital signature tool, such as Docusign can improve this experience, but it still won’t do a full job of satisfying the other problems that word doc authorisations present. Read on!
It’s difficult to keep track of who you’ve sent one to.
If you’re sending authorisations via email attachments, you’ll need a completely separate way to track who you’ve actually sent your authorisations to. After all, true compliance means you are 100% authorised by all of your clients. The easiest way to do this is to run a spreadsheet, marking a cell against each client you send an authorisation to. This is cumbersome and prone to errors.
It’s difficult to keep track of who has signed.
For the very same reasons as above, tracking signatures is difficult when you are sending authorisations via email. You need to know who has signed versus who is outstanding. A digital signature tool like Docusign might make it slightly easier, but most of the time, the User Interface does not make it fast to find the authorisation you need. Again, the most common go-to solution is a spreadsheet. Again, this is cumbersome and prone to errors.
How do you keep track of the signed date?
Given the annual obligation, it’s important to know when the authorisation was signed, so that you can plan for renewal next year. If you are a growing practice, you’ll be adding new clients throughout the year, which means you may end up with multiple Authorisation renewal dates.
Again, you may need to fall back to that trusty spreadsheet again. More manual entry, more margin for error.
Pro-tip: try and align everyone to the same authorisation renewal date. This just means they’ll be signing their second authorisation within 12 months of their first. After that, it’ll be every 12 months.
How do you keep track of renewal reminders?
If you do opt to keep the authorisation renewal date the same as the date they signed as a brand new customer, you’ll need a way to keep track of the authorisations coming up for renewal every single month. You can keep the date in your (ahem) spreadsheet, but then you need to set up a task or calendar reminder to go in and look. That’s annoying.
So how does PI make this easier?
Sending your STP Engagement Authorities via Ignition solves all the problems that you’d encounter if you were to send them via Word or PDF. It’s a beautiful, easy client experience, and it becomes incredibly easy to track all of your engagements.
You can sort all of your engagements by end date, filter by the engagement letter template. You can even tag your engagements so you can search however you like! We even send you a weekly email summary which lists the proposals/authorities set for renewal in the coming weeks!
If you’re eager to learn exactly how to run your STP engagement authorities through Ignition, we've created a comprehensive guide with exact steps to follow. We've also included pre-formatted templates that you can just simply copy and paste right into your PI account.
Even better, if you want to solve the same problem for your BAS Agent Authority to Act and Authority to Lodge, the same lessons apply!
