Single Touch Payroll Phase 2 is Here!

Single Touch Payroll Phase 2 – also known as STP Phase 2 – has been in effect since the start of the year, and there are a number of important changes to note.

Firstly, a gross amount must now be reported in more detail. This means that instead of a single gross amount, you must separately report gross, paid leave, allowances, overtime, bonuses & commissions, directors’ fees, lump-sum W, and salary sacrifice.

Employment & taxation conditions are now all streamlined in your Single Touch Payroll report, and reporting of income types has changed.

You may now need to report a country code along with information about host & home countries when making payments to employees whose income type is foreign employment income, an inbound assignee to Australia, or a working holidaymaker.

If you have changed your business structure or software and are unable to finalise previous records, you may have the option to provide the ATO with previous Business Management Software IDs and Payroll IDs in your STP report.

The ATO will not issue penalties for genuine mistakes made during the first year of Phase 2 reporting, ending on 31 December 2022, and extensions may be available in specific circumstances.