Who must report under Single Touch Payroll Phase 2?
The applicability test for Report under Single Touch Payroll Phase 2 (ATO), computed across 35 industries, 9 business structures and 6 size bands.
Short answer: Some businesses
Applies when the business has employees.
What the obligation is
Disaggregated payroll reporting to the ATO via STP-enabled software.
STP Phase 2 requires employers to disaggregate gross income into income types, allowances and deductions, and report new fields including employment basis, tax treatment code, and cessation reason. From 1 July 2026, Payday Super extends STP with QE and Super Liability fields. STP Phase 2 is the standard reporting method for all employers.
The applicability test
Applies when the business has employees.
How the regulator frames it: All employers.
What triggers it: Paying wages or salaries.
Jurisdiction: Commonwealth law, so the test is the same in every state and territory.
Which industries are in or out
Outcome across the 35 industries Rules Mate maps (35 of 35: depends on size or structure).
The answer is the same in every industry: depends on size or structure. Industry does not change who must comply.
Business structure and size
Structure does not change the answer across all industries: for every structure the answer is "depends on size or structure".
| Size band | Answer across all industries, any structure |
|---|---|
| No employees (turnover $100K–$1M) | No |
| 1–5 employees (turnover $100K–$1M) | Yes |
| 6–19 employees (turnover $1M–$3M) | Yes |
| 20–99 employees (turnover $3M–$10M) | Yes |
| 100–499 employees (turnover $10M–$100M) | Yes |
| 500+ employees (turnover $100M–$1B) | Yes |
Worked examples
Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:
- Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: applies. You have employees (6–19)
- Pty Ltd company in real estate agents with no employees, turnover $100K–$1M: does not apply. Requires employees.
What you must do, and when
- When due
- On or before each payday.
- Frequency
- Ongoing
- Evidence to keep
- STP submissions in payroll software; ATO STP reports.
- Status
- Current
- Priority
- High
Penalty for not complying
Maximum penalty: Failure to lodge on time penalties; PAYG withholding penalties for incorrect reporting.
Audit or assurance level
Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.
Dates in the compliance calendar
Obligations with the same applicability test
If this obligation applies to you, so do these 11: the engine uses the same rule for each.
- Pay superannuation on every payday (Payday Super)
- Pay employees in accordance with the applicable modern award
- Honour employees' right to disconnect (s 333M)
- Verify work rights via VEVO before employment
- Comply with Paid Parental Leave scheme (26 weeks by 1 July 2026)
- Pay annual leave loading where the award or contract provides
- Provide 10 days personal/carer's leave per NES
- Provide 10 days paid family + domestic violence leave (FDV)
- Document VEVO checks + retain employer records (s 245AYL Migration Act)
- Provide minimum notice of termination (NES s 117)
- Right to Disconnect (s 333M FWA)
Where it sits in the corpus
Rules Mate tracks 4 published obligations tagged "payroll", 2 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 3 of those apply outright. This obligation is rated high priority, and is an ongoing duty.
Regulator, legislation and tools
Regulated by Australian Taxation Office.
ATO: Federal tax administrator covering income tax, GST, PAYG, FBT, superannuation guarantee, STP, and self-managed super funds. Also administers the Director ID regime via ABRS.
TAA: General tax administration — PAYG withholding (Sch 1 Pt 2-5), STP, Director Penalty Notice regime (Sch 1 Subdiv 269-B), assessment + objection process, penalties + general interest charge.
Free tools that help with this obligation:
Questions
- Who must report under Single Touch Payroll Phase 2?
- Applies when the business has employees.
- Do sole traders need to report under Single Touch Payroll Phase 2?
- Depends on size or structure. Across every industry and every size band, the engine's answer for a sole trader is: depends on size or structure.
- Do businesses with 1–5 employees need to report under Single Touch Payroll Phase 2?
- Yes (1–5 employees, turnover $100K–$1M).
- When is "Report under Single Touch Payroll Phase 2" due?
- On or before each payday.
Related
Sources
Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.