Single Touch Payroll for casual workforces: what STP reports, and what payroll needs first

Short version: Single Touch Payroll (STP) is how employers report salaries and wages, PAYG withholding and super information to the ATO from STP-enabled payroll software, on or before each payday. Under STP Phase 2 the report splits pay into payment types and carries each employee’s employment basis and tax treatment. It reports amounts paid, not hours worked. For paydays from 1 July 2026 it also carries year-to-date qualifying earnings and super liability. A casual employee is reported as casual — including when a labour hire business places them with a client. OnCrew does not lodge STP; your payroll software does.

What STP is

STP is a mandatory reporting obligation for employers. It started on 1 July 2018 for employers with 20 or more employees and on 1 July 2019 for smaller employers, and from 1 January 2022 it was expanded into what the ATO calls STP Phase 2. Each time you pay employees, your STP-enabled payroll or accounting software sends a report to the ATO covering salaries and wages, PAYG withholding and super liability information. The report is due on or before payday.

The STP rules themselves don’t change for casuals. A casual is reported, withheld from and finalised like any other employee. The difference with a casual workforce is volume: more starters, more leavers and more short engagements, each of which needs its payroll set-up right before the first pay.

What STP Phase 2 reports

Instead of one gross figure, payroll software must report payment types separately:

• Gross — ordinary pay that isn’t itemised elsewhere. For casuals this includes the casual loading and shift penalties (including public holiday penalties), which the ATO says are reported as gross, not separately.
• Overtime — work beyond ordinary hours, outside the agreed hours or outside the span of ordinary hours. Shift penalties are not overtime.
• Allowances — itemised by type, with limited exceptions (for example where an allowance forms part of an overtime payment).
• Paid leave, bonuses and commissions, directors’ fees, lump sum W and salary sacrifice, each reported separately.

Alongside the amounts, each employee’s report carries their employment basis, a six-character tax treatment code that reflects their TFN and withholding declarations, their commencement date and, when they leave, the cessation date and reason.

Employment basis: casual is C, and “labour hire” is not your casuals

Employment basis must be reported each pay. The ATO’s codes are full time (F), part time (P), casual (C), labour hire (L), voluntary agreement (V), death beneficiary (D) and non-employee (N). Its description of casual is a person who doesn’t have a firm commitment in advance about how long they’ll be engaged or the days or hours they’ll work.

The trap for labour hire businesses is the name. In STP, L is for a contractor engaged by the payer to work for the payer’s client, and the ATO says not to use it for workers who are your employees. A casual employee that a labour hire business places with a client is reported according to their work type — casual — not as L.

Employment basis also has to change when the work does. If a casual moves to part-time or full-time employment — including through the employee choice pathway — the new basis must be reported from then on, even if the employee hasn’t given you a new TFN declaration.

TFN declarations: collected and kept, no longer sent

Employees still give their employer a TFN declaration; STP Phase 2 doesn’t change that. What changed is that an employer reporting through STP-enabled software doesn’t send it to the ATO — the employment and tax information in the STP report replaces it. You must keep the declaration (or the tax details summary an employee receives when they complete it through ATO online services) and store and dispose of it securely.

The answers on it — tax-free threshold, residency for tax purposes, study and training support loans — feed the tax treatment code and how much is withheld. A worker who hasn’t provided a TFN generally has tax withheld at the top rate, so getting tax details in before the first pay matters more when people start at short notice.

Super: what STP carries from 1 July 2026

Under Payday Super, the super guarantee is 12% of each employee’s qualifying earnings, paid for each payday and received by the fund within 7 business days — longer in some cases, such as 20 business days for the first contribution for a new employee. For paydays from 1 July 2026, STP reports must also include each employee’s year-to-date qualifying earnings and super liability. The ATO will still accept ordinary time earnings (OTE) reporting until 30 June 2027; from 1 July 2027 it says reporting without both amounts will be rejected and penalties may apply.

What counts follows the familiar rules: the ATO lists casual loading and shift penalties as qualifying earnings, while overtime is not where the employee’s ordinary hours are clearly identified. More in Payday Super for labour hire agencies.

Corrections and finalisation

• Finalisation. You make a finalisation declaration for each employee you paid in the financial year, by 14 July — including casuals who worked a handful of shifts and left months earlier. You can also finalise during the year when someone leaves; if you then pay them again, the ATO’s guidance is to finalise again for a one-off payment, or remove the indicator if you expect to keep paying them.
• Corrections. If the year-to-date figures you reported don’t match payroll, the ATO expects updated information within 14 days of the need for a correction being identified, or in the next regular pay event in the same financial year. Finalised information can be amended up to 5 years after the end of the financial year.
• Award transport payments. For payments from 1 October 2026, amounts that used to be award transport payments must have tax withheld and are no longer identified separately in STP, following the Treasury Laws Amendment (Tax Reform No. 1) Act 2026. Your payroll provider should have guidance on the transition.

Where STP goes wrong in a casual workforce

Most STP problems in casual-heavy businesses start upstream of the payroll software:

• The wrong employment basis — casual employees reported as labour hire (L), or a casual who has moved to part-time still reported as casual.
• Tax details arriving after the first pay, so the wrong amount is withheld until they are sorted out.
• Hours not approved in time. With super due at the fund within 7 business days of payday, a late or disputed timesheet now affects super as well as wages.
• Pay items mapped to the wrong STP category — overtime set up as ordinary pay, or allowances left inside gross. This is configured in payroll, not keyed in each pay.
• Working holiday makers paid before the business has registered with the ATO as an employer of working holiday makers, which the tax treatment reflects.
• Short-term casuals not finalised because they had already left by July.

Where OnCrew fits, and where it does not

OnCrew does not lodge STP. It isn’t STP-enabled payroll software. It doesn’t run payroll, calculate pay, withholding or super, set the employment basis or tax treatment code, or split hours into ordinary time, overtime, penalties or allowances. That happens in your payroll system and with the people who run it.

What OnCrew handles is part of what payroll starts from:

• Approved hours. Shifts, actual clock-in and clock-out times, and supervisor approval. Each clock-in is location-checked against the site, and one outside the boundary is flagged for review rather than blocked; clock-out is time-stamped but not location-checked. Only approved timesheets go into the payroll export.
• The export. The Employment Hero-format file carries each shift’s worker, date, start and finish times, break, hours, client and a work-type label for sleepovers, on-call and broken shifts (blank for an ordinary shift). The MYOB and Xero (via UpSheets) files carry name, date, hours and a pay category or type. Hours are clock-in to clock-out less the unpaid break you configure, unless a site is set to pay the rostered shift, and agencies on weekly timesheets have workers enter their own hours. The export does not separate ordinary time from overtime, and it carries no pay rates, allowances or tax details.
• Tax details at onboarding. Once your business has recorded a worker as an employee, onboarding asks them for their TFN, residency for tax purposes, tax-free threshold and study-loan answers, signed with their typed name, along with bank details and, optionally, a super fund and member number. TFN, tax and bank details are stored encrypted, and only certain roles can reveal them, with each reveal logged. They are not part of the timesheet export, so they are entered into payroll separately.
• How you engage each worker. An admin records whether your business engages a worker as an employee or a contractor, or leaves them as not classified yet. That is your declaration, not a legal ruling, and it is not the STP employment basis — OnCrew does not record full-time, part-time or casual. See sham contracting vs genuine casual employment.

So the split is simple: OnCrew helps get approved hours and new-starter details in early and in one place, and your payroll system turns them into pay, withholding, super and the STP report. More on that division in native payroll vs timesheet export.

A practical sequence for each new casual

1. Decide how you engage them — employee or contractor — and, for an employee, whether the work is genuinely casual.
2. Collect the TFN declaration and other tax details before the first pay, along with bank and super fund details.
3. Set them up in payroll with employment basis C (casual), the right tax treatment, and pay items mapped to the right STP categories.
4. Approve each shift’s hours before the pay run, so wages and super are calculated from final figures.
5. Pay, and let payroll lodge the STP report on or before payday; make sure super reaches the fund within 7 business days (20 for a new employee’s first contribution).
6. If their pattern of work changes or they become permanent, update the employment basis.
7. When they leave, report the cessation — and make sure they are finalised by 14 July.

Official sources checked for this guide (October 2026): ATO — what STP is · ATO — disaggregation of gross · ATO — employment and tax information in STP Phase 2 · ATO — rules of reporting through STP · ATO — correcting STP information · ATO — finalising your STP data · ATO — changes to award transport payments · ATO — TFN declaration: payer obligations · ATO — STP reporting under Payday Super · ATO — payment deadlines for Payday Super · ATO — what payments are qualifying earnings · Fair Work Ombudsman — record-keeping