Show download pdf controls
  • Get ready for Single Touch Payroll

    Single Touch Payroll (STP) is mandatory for 'substantial employers' (those with 20 or more employees) from 1 July 2018.

    To find out if you are a substantial employer, count the employees on your payroll on 1 April 2018. You do not need to send us your headcount information. However, you may want to keep a copy for your own records.

    • Count each employee, not the full time equivalent (FTE).
    • The headcount a bit like the census. You can do it after 1 April, but you need to count the employees who were on your payroll on 1 April.
    • Once you become a substantial employer you will need to continue reporting through STP even if your employee numbers drop to 19 or less – unless you apply for and are granted an exemption.
    • You don't need to send us your headcount information. This is for you to determine if you need to start STP reporting from 1 July 2018. You may want to keep a copy for your own records.
    • If you are part of a company group, you must include the total number of employees employed by all member companies of the wholly-owned group.

    How to count your employees

    Include in headcount

    • full-time employees
    • part-time employees
    • casual employees who are on your payroll on 1 April and worked any time during March
    • employees based overseas
    • any employee absent or on leave (paid or unpaid)
    • seasonal employees (staff who are engaged short term to meet a regular peak workload, for example, harvest workers).

    Don't include in headcount

    • any employees who ceased work before 1 April
    • casual employees who did not work in March
    • independent contractors
    • staff provided by a third-party labour hire organisation
    • company directors
    • office holders
    • religious practitioners.

    Directors, office holders and religious practitioners are not included in the headcount. They are not considered employees within the common law meaning of the term.

    However, when you start reporting through STP you will need to report their payment information. This is because the payments are subject to withholding and are currently reported in the Individual non-business payment summary.

    Get ready for STP checklist

    1. Speak to your payroll software provider
      • Find out how your payroll software provider will offer Single Touch Payroll (STP) reporting – this may be through an update to your existing software, or an additional service.
      • Check if they have a deferred start date for your product.
      • Find out what support they will offer to their clients to transition to STP.
      • Subscribe to their communications – this may be email, newsletter or web updates.
    2. Connect with us  
    3. Review your business processes
      • Make sure the right people in your business know about Single Touch Payroll – especially your payroll staff.
      • Check if you are paying your employees correctly.
      • Check if you are calculating your employees’ super entitlements correctly.
      • Check if you are addressing overpayments correctly.
      • Is your employee information accurate, including names, addresses, date-of-birth records?
    4. Apply for more time if you need it
      • If your software will be ready, but you won’t, you will need to apply to us for a deferred start date.
      • If your payroll software provider has a deferred start date, and you still need more time, you will need to apply for your own deferral.
      • Make sure you follow the ATO guidelines and provide all the evidence required. We only provide deferrals for extenuating circumstances.
    5. Update your software when it is ready, and start reporting to us
      • We will help and support you through your first year of reporting.
      • It's ok if you make a mistake – you will be able to make corrections.
      • The first year is a transition and penalties will generally not apply.

    See also:


    We will consider granting employers and payroll software providers a deferred start date for Single Touch Payroll if you are unable to get ready by 1 July 2018 due to extenuating circumstances. You will need to provide evidence, and meet a number of requirements.

    Employers with a deferral will start reporting during the financial year, rather than on the first pay after 1 July 2018. See Transitioning to Single Touch Payroll

    Payroll software provider deferrals

    Some payroll software providers have told us they will not have their payroll solution ready to offer STP to their clients by 1 July 2018. They are applying for additional time to commence STP reporting for some or all of their products.

    If granted, the deferral will apply to existing customers of the specific software version. These customers will need to start reporting through STP on or before the deferred date.

    Your payroll software provider will let you know if and when a deferral is granted for your software product. If you are unable get ready by then, you will need to apply for your own deferral in addition to this.

    Employer deferrals

    If you are unable to get ready for Single Touch Payroll (STP) we may defer the date you are required to start reporting. We will consider employer deferrals if you:

    • have entered administration or liquidation
    • have been impacted by a natural disaster
    • are unable to get ready by your software provider's deferred start date
    • are transitioning to a new STP-enabled solution
    • are using a customised payroll solution and you need time to configure and test your updated product
    • have complex payroll arrangements and need additional time to transition to STP
    • are affected by other circumstances which are out of your control.

    You will be able to apply for a deferral using an online form which will be available here by the end of March 2018.

    You or your registered agent can submit the form using the Business Portal, Tax Agent Portal or BAS Agent Portal.


    We will consider granting an exemption from Single Touch Payroll (STP) reporting if:

    • you are located in a rural area with no reliable internet connection
    • you are classed as a substantial employer (20 or more employees) because you employ 20 or more employees for a short period of the income year which includes 1 April – for example, due to seasonal work.

    You may seek an exemption for reporting a particular employee or group of employees' information through STP. This includes an employee of a department, agency or entity of a foreign government not resident in Australia, such as a diplomat.

    You can also seek an exemption for reporting an employee who is not recorded in an Australian payroll system.

    If you are granted an exemption for an employee or group of employees, you will need to report your other employees' information through STP.

    If you are granted an exemption you will not need to start STP reporting for the year(s) you are covered by the exemption. You must continue to comply with your existing PAYG withholding obligations including:

    • reporting and paying your PAYG withholding liability
    • giving payment summaries to your employees
    • giving a payment summary annual report to the ATO.

    How to apply for an exemption

    You or your registered agent can submit a request using the Business Portal, Tax Agent Portal or BAS Agent Portal:

    1. Select General questions > problems > help as the message topic.
    2. Enter Single Touch Payroll as the message subject.
    3. Include the following information:
      • the number of employees on your payroll – this will help us understand the size and complexity of your business.
      • the reasons why you are unable to report through STP
      • any steps you have taken to attempt to get ready for STP
      • any supporting evidence that may help us understand your circumstances.

    If you are requesting an exemption for reporting a particular employee or group of employees, provide:

    • the details of the employee
    • the nature of their employment
    • any supporting evidence.

    When we receive your request we may contact you for further information.

    Last modified: 05 Mar 2018QC 54703