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Understanding Single Touch Payroll
Single Touch Payroll changed the way Australian employers report to the ATO. Instead of tallying wages, tax and super and reporting them once a year, you report them every pay run — automatically, from your payroll software, at the same time you pay staff.
The goal is real-time visibility: the ATO (and, through STP Phase 2, other agencies) see accurate pay and withholding data as it happens, and employees can see their year-to-date figures through myGov.
What you report through STP
- Gross wages and salaries for each employee
- PAYG withholding (the tax withheld from pay)
- Superannuation liability information
- Under STP Phase 2, a breakdown of pay components, income types, and study/training loan (STSL) amounts
STP Phase 2
STP Phase 2 expanded the detail employers report. Rather than a single gross figure, pay is disaggregated into components — ordinary hours, overtime, allowances, paid leave, bonuses and commissions — along with income types, employment basis, and cessation reasons when someone leaves. This lets government agencies use STP data directly instead of asking employers for separate reports.
Set pay categories up correctly
STP Phase 2 relies on pay items being mapped to the right categories (ordinary, overtime, each allowance type, paid leave). Getting this mapping right in your payroll software is what keeps STP reporting accurate.
Who must comply
STP applies to virtually all Australian employers, including small and micro businesses. Some concessions and later start dates have applied to particular groups (such as closely held payees and some micro-employers), but the baseline expectation is that every employer reports each pay run through STP-enabled software. Check the ATO's Single Touch Payroll guidance for your situation.
Common STP mistakes
Wrong pay-item mapping
Lumping allowances or overtime into gross pay breaks STP Phase 2 reporting. Map each pay component to its correct category.
Inaccurate hours feeding payroll
If timesheets are wrong, STP reports the wrong figures. Capture accurate hours and award rates before payroll runs.
Key takeaways
- STP reports wages, PAYG and super to the ATO every pay run, from your software.
- It's mandatory for virtually all employers, including small businesses.
- STP Phase 2 requires more detail — component-level pay, income types and STSL.
- Accurate hours and pay-item mapping keep STP reporting correct.
RosterElf feeds award-interpreted timesheets into STP-enabled payroll via payroll integration, so the hours, allowances and pay that flow into your STP report are accurate from the start.
