Single Touch Payroll (STP) Phase 2 is an expansion of the ATO's real-time payroll reporting framework. Each time you run a pay event, you send the ATO disaggregated payroll data — ordinary gross, overtime, paid leave, allowances by type, bonuses and commissions, lump sums, salary sacrifice and back payments — together with PAYG withholding and super liability for each employee. Phase 2 also moves TFN declarations and employment-cessation reporting into the same data feed.

When did STP Phase 2 become mandatory?

STP Phase 2 became mandatory on 1 January 2022 for all employers. Some Digital Service Providers were granted product-level deferrals to migrate their customers; if your software vendor was granted a deferral, you reported under that vendor's deferral until you transitioned. There is no longer a deferral path — every employer must report through STP Phase 2.

What does HelloBooks report under STP Phase 2?

HelloBooks reports the full set of mandatory STP Phase 2 fields per pay event: BMS identifier and payee identifier, period and year-to-date gross broken into ordinary, overtime, paid leave (with type), allowances (itemised), bonuses and commissions, directors fees, lump sums (A/B/D/E/W), salary sacrifice (type O and S) and back payments. We also report PAYG withholding, employer super liability, employment basis, income type, country code, tax treatment code, TFN declaration data and cessation type when applicable.

Do I still need to lodge a TFN declaration form for new employees?

No. Under STP Phase 2 the TFN declaration data is sent to the ATO through the STP feed. HelloBooks captures the same fields the paper TFN declaration captured (TFN, tax-free threshold, HELP/STSL, Medicare levy adjustments, tax offsets) and includes them in the next pay event submission, which the ATO accepts in place of the paper form.

Do I still need to give employees a payment summary at the end of the year?

No. If you report through STP and finalise the year for each employee in HelloBooks, the ATO treats the year-to-date STP data as the equivalent of the payment summary, and employees see their income statement in myGov. You do not lodge a PAYG payment summary annual report for STP-reported amounts.

Does HelloBooks lodge STP directly to the ATO?

Yes. HelloBooks integrates with the ATO's STP service and sends pay events on submission. The ATO acknowledges each event and you see the lodgement status, any validation errors, and the year-to-date totals per employee inside HelloBooks. If a submission is rejected, the error is surfaced against the offending field so you can fix it and resubmit.

How does HelloBooks handle the disaggregated gross categories?

Pay items in HelloBooks are typed at setup (ordinary, overtime, leave-type X, allowance-type Y, bonus, directors fee, lump sum, salary sacrifice, back pay). The category — not just the dollar value — flows through to the STP submission, so the ATO receives ordinary wages separately from overtime, allowances are itemised by category code, and salary sacrifice is reported as a separate item rather than netted off gross.

What if I find an error in a previous pay event?

You correct it in the next pay event. STP Phase 2 reports year-to-date amounts on every submission, so an adjustment in HelloBooks updates the YTD figure the ATO holds. For corrections that need to be flagged separately (e.g. a back payment that relates to a prior year), HelloBooks tags the relevant pay item with the financial year the payment relates to so the ATO can apply the correct rules.

Does STP Phase 2 replace SuperStream?

No. STP and SuperStream are separate obligations. STP reports payroll figures (including the super liability) to the ATO each pay event. SuperStream is the separate data and payment standard used to actually transfer super contributions to the employee's super fund. HelloBooks handles both — see the SuperStream guide for the contributions workflow.

Does HelloBooks support closely held payees, working holiday makers and foreign employment income?

Yes. HelloBooks supports all STP Phase 2 income types, including salary and wages, closely held payee, working holiday maker, seasonal worker programme, labour hire, foreign employment, voluntary agreement and other specified payments. The income type and (where applicable) country code are set on the employee record and flow through to every pay event.

Australia · Payroll

Single Touch Payroll (STP) Phase 2

Single Touch Payroll Phase 2 is the ATO’s mandatory real-time payroll reporting standard. Every pay event you run sends the ATO disaggregated payroll data per employee — ordinary gross, overtime, paid leave, itemised allowances, bonuses, lump sums, salary sacrifice and back payments — together with PAYG withholding and super liability. STP Phase 2 has been mandatory for all Australian employers since 1 January 2022. HelloBooks reports STP Phase 2 directly from the pay run, no separate payroll system required.

Last updated: 2026-05-09Last reviewed against ATO docs: 2026-05-09

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What ATO requires

STP Phase 2 disaggregated gross

The defining change in Phase 2 is that gross is no longer reported as a single number. The ATO requires gross broken into specific categories so it can apply the right rules for tax, super, child support and Services Australia income testing without re-asking the employer.

Source: ATO — STP Phase 2 employer reporting guidelines

Gross (ordinary salary and wages)

Reported separately from overtime, bonuses, allowances etc.

Overtime

Including overtime allowances treated as overtime under the Fair Work instrument.

Paid leave

With type code: cash-out of leave, paid parental leave, ancillary leave, other paid leave.

Allowances

Itemised by category — car, transport, laundry, meals, travel, qualification, task, tools, other.

Bonuses and commissions

Reported as a separate category, not folded into gross.

Directors fees

Reported as a separate category for relevant officeholders.

Lump sum payments

Lump sum A, B, D, E and W with the appropriate type code per ATO rules.

Salary sacrifice

Type O (other) and Type S (salary sacrifice to super) reported separately under Phase 2.

Back payments

Reported with the financial year(s) the payment relates to.

HelloBooks employee STP Phase 2 setup screen

STP Phase 2 employee fields in HelloBooks (illustrative; AU-specific capture pending).

Employee-level data

Employee fields HelloBooks captures

Income type (salary and wages, closely held payee, working holiday maker, foreign employment, etc.)
Country code (for foreign employment and working holiday maker income types)
Tax File Number (TFN) declaration data — sent through STP rather than as a separate paper form
Tax treatment code that captures TFN declaration, tax-free threshold, HELP/STSL, Medicare exemption and tax offset claims
Employment basis (full-time, part-time, casual, labour hire, voluntary agreement, death beneficiary, non-employee)
Cessation type (e.g. voluntary cessation, redundancy, ill health) reported when an employee leaves

How HelloBooks does this

Pay run → STP submission → Year-end finalise

1
Set up the employee with Phase 2 fields
Each employee record in HelloBooks captures income type, country code, employment basis and tax treatment code at onboarding. The TFN declaration is collected through the same form so a separate paper TFN declaration is no longer required.
2
Run the pay event
When you run a pay run, HelloBooks calculates each disaggregated gross category — ordinary, overtime, leave, allowances by type, bonuses, directors fees, lump sums, salary sacrifice — and the corresponding PAYG withholding for the period.
3
Submit to the ATO each pay event
On finalising the pay run, HelloBooks builds an STP Phase 2 submission with year-to-date gross-by-category, PAYG withholding, super liability and BMS identifier and sends it to the ATO. You see the lodgement status and any ATO response codes inside HelloBooks.
4
Finalise at year-end
At year-end you finalise STP for each employee directly in HelloBooks — no separate payment summaries, no PAYG payment summary annual report. Employees see their income statement in myGov as soon as you finalise.

HelloBooks pay run with STP Phase 2 submission status

Pay run with STP submission status (illustrative; AU-specific capture pending).

Related HelloBooks AU guides

ATO source documents

Reviewed against ato.gov.au on 2026-05-09.

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Single Touch Payroll (STP) Phase 2

STP Phase 2 disaggregated gross

Employee fields HelloBooks captures

Pay run → STP submission → Year-end finalise

Set up the employee with Phase 2 fields

Run the pay event

Submit to the ATO each pay event

Finalise at year-end

Related HelloBooks AU guides

ATO source documents

STP Phase 2 questions answered

Ready to automate your books?

Single Touch Payroll (STP) Phase 2

STP Phase 2 disaggregated gross

Employee fields HelloBooks captures

Pay run → STP submission → Year-end finalise

Set up the employee with Phase 2 fields

Run the pay event

Submit to the ATO each pay event

Finalise at year-end

Related HelloBooks AU guides

ATO source documents

STP Phase 2 questions answered

What is STP Phase 2?

When did STP Phase 2 become mandatory?

What does HelloBooks report under STP Phase 2?

Do I still need to lodge a TFN declaration form for new employees?

Do I still need to give employees a payment summary at the end of the year?

Does HelloBooks lodge STP directly to the ATO?

How does HelloBooks handle the disaggregated gross categories?

What if I find an error in a previous pay event?

Does STP Phase 2 replace SuperStream?

Does HelloBooks support closely held payees, working holiday makers and foreign employment income?

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