What are the single touch payroll rules employers must follow?

Single Touch Payroll (STP) changed how employers report payroll to the ATO. This article lists the specific rules that matter to small and medium employers, explains the payday super change that started on 1 July 2026, and gives a practical, pay‑run checklist you can use today. Where the ATO provides formal guidance, links to the authoritative pages are included so you can review the technical detail.

Quick summary: what STP requires and who must report

At its core STP requires employers to report employee salaries and wages, pay as you go (PAYG) withholding and super information to the ATO at the time they pay employees. The system was rolled out in phases and became compulsory for larger employers from 2018. The ATO and software developers publish implementation and technical guidance for employers and payroll providers Single Touch Payroll | ATO Software Developers.

Exactly what to report through STP: pay, PAYG withholding and super

Each STP pay event must include these three core elements:

Pay, meaning gross salary and wages and reportable allowances or employment payments.
PAYG withholding, the tax withheld from employee pay for the pay period.
Super information, the superannuation guarantee or other employer super liabilities for the pay period.

If you report and finalise an employee’s amounts through STP, you do not have to issue a traditional payment summary. Instead employees access their income statement in myGov where year-to-date salary, tax withheld and super amounts appear Accessing your income statement online | ATO. You must still prepare a payment summary for any payments not reported through STP PAYG payment summaries: forms and guidelines | ATO.

What changed on 1 July 2026: payday super reporting you must include each payday

From 1 July 2026 the ATO requires payroll systems to include additional payday super data in STP reporting. Employers must now report, with each pay event, the employee’s year to date qualifying earnings and the employer super liability for that pay period. This payday super rollout means payroll calculations and STP data fields must be configured so qualifying earnings are computed and transmitted every pay run Payday Super starts 1 July | ATO Community.

Practical payday checklist for STP reporting (pre-pay, at-pay, post-pay)

The checklist below is written for payroll teams using cloud payroll software. It covers routine checks to complete each pay run to meet STP rules and the payday super additions.

Pre-pay checks: employee details, pay categories and super settings

Confirm each employee’s Tax File Number and name match ATO records. Incorrect TFNs create reconciliation work and may trigger ATO follow-up.
Verify employment basis and pay categories: ordinary hours, casual loadings, allowances, bonuses and other reportable pay types must map to the correct STP earnings codes.
Check super fund details and whether the nominated fund accepts employee contributions. For non-standard arrangements confirm how the software will report super liabilities.
Update any year to date adjustments before the pay event so the STP year to date figures reflect the true balances you will report.

These pre-pay verifications align with the ATO’s STP data requirements and reduce the risk of incorrect reporting during the pay event Single Touch Payroll | ATO Software Developers.

At-pay steps: submit the pay event and include qualifying earnings for payday super

Process the payroll in your cloud system and confirm the pay event contains gross pay, PAYG withheld and super liability values for each employee.
Include year to date qualifying earnings and the specific super liability fields required under the payday super update for the pay event you submit to STP Payday Super starts 1 July | ATO Community.
Send the STP pay event to the ATO when you pay, not before. Reporting at the time of payment keeps employee online income statements current and aligns with ATO expectations Single Touch Payroll | ATO Software Developers.

Post-pay review: reconcile, correct mistakes and keep records

Reconcile payroll ledger totals to the STP pay events. Confirm gross wages, PAYG withheld and super liabilities match your accounting records.
If you find an error, correct it promptly through your payroll software using the provider’s STP correction or update process and resend the corrected pay event.
Keep payroll records and proof of STP submissions for your statutory retention period so you can respond to any ATO queries.

The ATO provides guidance on corrections and finalisation for employers reporting via STP PAYG payment summaries: forms and guidelines | ATO.

Configuration checklist for Xero, MYOB and QuickBooks users

If your payroll runs on Xero, MYOB or QuickBooks, complete these configuration checks before your next live pay run:

Confirm your payroll software is on the latest release that supports the payday super fields.
Map internal pay categories to the software’s STP earnings codes and test with a single employee to confirm correct mapping.
Run a test STP file to the ATO sandbox or a trial pay event where your software supports it, and confirm the year to date qualifying earnings and super liability fields are sent.
Document your pay-run process, who authorises STP submissions and who performs reconciliations so responsibility is clear.

These vendor neutral checks reflect the ATO requirement that employers report accurate data at the time of payment and include the payday super additions on each pay run Single Touch Payroll | ATO Software Developers, Payday Super starts 1 July | ATO Community.

Year‑end finalisation and payment summaries: what changes with STP finalisation

Finalising year data in STP tells the ATO the amounts for each employee are complete for the year. For amounts reported and finalised through STP, employers do not have to issue payment summaries. You must prepare payment summaries for any amounts not reported through STP PAYG payment summaries: forms and guidelines | ATO. Finalisation is an important control point to confirm year to date figures are correct in ATO records.

Common mistakes, ATO risks and how to fix STP errors

Late or missing pay event submissions. Remedy by submitting the omitted pay event as soon as possible and document why the omission occurred.
Incorrect TFNs or employee details. Update the employee record, submit a correction through your payroll software and reconcile the ATO income statements.
Wrong super amounts or missing payday super fields. Recalculate the liability, correct via a follow up STP submission, and keep evidence of the recalculation for compliance purposes.
Failing to finalise year data. Complete the finalisation step so employees can access correct income statements in myGov Accessing your income statement online | ATO.

Follow your software provider’s correction flow and keep a clear audit trail of what you changed and why. Clear records and timely corrections reduce the risk of ATO enquiries and make responses quicker if the ATO reviews a lodged pay event.

Should you outsource STP reporting and how to choose a local payroll partner

Outsourcing STP is sensible if your business lacks specialist payroll expertise, you want to lower the risk of late or incorrect reporting, or you need a process that scales with changing ATO requirements. When you evaluate providers, ask about the items below.

Decision checklist: cost, control, compliance and data security

Ongoing cost and how the provider charges for payroll and STP reporting compared to internal staff time and software licensing.
Control and access: who submits STP events and how you review them before lodgement.
Software integrations and partnerships with Xero, MYOB or QuickBooks, which affect how smoothly systems connect Advanced Accounting Taxation & Business Services.
Data security, privacy arrangements and how payroll records are stored and accessed.
Service levels for urgent fixes and reconciliation support if the ATO raises queries.

Real objections employers raise and how a provider answers them

Cost, answered by comparing internal processing time, potential ATO penalties and the value of reliable compliance to a bundled service fee.
Loss of control, answered by requesting transparent workflows, approval gates and shared access to STP reports before lodgement.
Privacy, answered by reviewing the provider’s privacy policy, encryption practices and whether they use secure local hosting.

Advanced Accounting Taxation & Business Services supports STP compliance and payroll services from Parramatta and Liverpool and offers a free initial consultation to discuss whether outsourcing or hybrid support fits your business. For a concise explanation of STP and reporting mechanics, see the practice blog on single touch payroll meaning.

Next steps: quick compliance actions to take this week

Run a full employee data audit and correct TFNs, names and super fund details.
Schedule a test pay run to confirm your payroll system sends the payday super fields and STP pay events as expected.
Document the pay‑run authorisation and STP submission process, and assign a backup person to cover absences.
If outsourcing is an option, book a short consultation to review your software, integration points and SLAs with a local provider.

Frequently asked questions

Who must report through Single Touch Payroll and when did STP start being mandatory?

STP reporting began in phases and became mandatory for larger employers from 1 July 2018. The ATO technical guidance explains the phased rollout and the types of employers covered under the rules Single Touch Payroll | ATO Software Developers.

Do I still need to give payment summaries if I report through STP?

No. If you report and finalise an employee’s amounts through STP you do not have to provide a payment summary. You must still prepare payment summaries for any payments not reported through STP PAYG payment summaries: forms and guidelines | ATO.

What is the payday super change from 1 July 2026 and how does it affect my pay runs?

From 1 July 2026 employers must include additional payday super fields in every STP submission, specifically year to date qualifying earnings and the super liability for the pay period. Review your payroll mapping so those fields are calculated and sent each payday Payday Super starts 1 July | ATO Community.

How do I correct an STP error if I reported the wrong amount or employee details?

Use your payroll software to submit an updated pay event or correction. Reconcile the corrected STP data to your payroll ledger and retain records explaining the change. The ATO guidance on STP and PAYG forms details employer correction and finalisation responsibilities Single Touch Payroll | ATO Software Developers, PAYG payment summaries: forms and guidelines | ATO.

What should I ask a local accountant before hiring them to handle my STP reporting?

Ask about their STP experience, payroll software expertise, how they handle corrections, their data security and privacy arrangements, references from similar clients, and whether they offer a test or onboarding dry run of live pay events. Advanced Accounting Taxation & Business Services provides payroll and STP compliance services and a free initial consultation to discuss your needs Advanced Accounting Taxation & Business Services.

Need practical help implementing the Single Touch Payroll rules or want a free initial consultation? Book a short session with Advanced Accounting Taxation & Business Services?