HR STP-2 Reporting Codes
  • 14 Mar 2024
  • 15 Minutes to read
  • Dark
    Light
  • PDF

HR STP-2 Reporting Codes

  • Dark
    Light
  • PDF

Article summary

Payments, Deductions and Superannuation data for each employee is automatically sent to the ATO when you finalize each payrun. Employers, using the same or different payroll systems, will often use a different name for the same type of payment or deduction.

Although this name may be sufficient on a pay slip for the employee to understand what the amount was for, the ATO systems have no way of deducing this, or of knowing that hundreds of different names from different employees and payroll systems were all related to exactly the same type of payment or deduction.

To overcome this, the ATO has issued a standard list of STP reporting codes that provide a single code for each type of payment and deduction.

Employers can continue using the same names they have always used but must add the appropriate STP reporting code to each payment type and deduction type in their payroll system.

These standard codes are automatically attached to every amount sent to the ATO, rather than the name printed on pay slips, enabling the ATO systems to understand exactly what each amount was for and to apply the appropriate taxation and processing.

Where must I add the STP codes?

You need to select the appropriate STP code(s) on each payment type (Earnings Types and Allowance Types) and Deduction Type in Marlin HR as shown below.

We have integrated the codes into Marlin HR so that you can select them from drop-down lists.

We have also included a Hint beside each field that you can click on to display information about the codes.

In addition, there are some reporting codes that you must select on each employee that will enable the ATO system to determine whether the appropriate tax is being withheld.

Earnings vs Allowances

The ATO differentiates between regular payments (known as Earnings Types in Marlin HR) and allowances (known as Allowance Types in Marlin HR) and has provided a different set of STP reporting codes for each. Y

ou must therefore create the correct type of payment (i.e. Earnings Type or Allowance Type) in Marlin HR so as to be able to select the correct reporting code.

This was not important prior to Phase 2 of STP reporting and some payment types were commonly created in Marlin HR as Allowance Types instead of Earnings Type (e.g. Bonus, Commission).

In preparing for STP reporting (Phase 2) employers had to discontinue these allowance types and create earnings types to replace them.

We have provided a table of payments below that indicates whether each particular type of payment needs to be set up in Marlin HR as an Earnings Type or an Allowance Type.

The ATO separates payments into "Allowances" and other payments, providing a different set of STP-2 reporting codes for each payment type. It is therefore important to set up each payment correctly in Marlin HR as an "Allowance" type or an "Earnings" type so that the appropriate STP-2 reporting code can be selected on it.

Prior to STP-2, it did not matter whether some payment types (eg. Bonuses, Commissions, Directors Fees, Community Service, Jury Duty, Workers Compensation Leave, Paid Parental Leave) were set up as "Allowance" types or "Earnings" types as they were not separated out from other payments in the reporting to the ATO.

However, as the ATO does not classify these particular payments as "Allowances", the STP-2 reporting codes it has provided for them are available on "Earnings" types and not "Allowance" types. As part of the migration to STP-2 reporting, customers that previously had these payments set up as "Allowance" types had to set them as inactive and re-create them as "Earnings" types so they could select the required STP-2 reporting codes.

The following section shows the STP-2 reporting codes provided by the ATO for Earnings types and for Allowance types and will help you to determine which type you should set up for a particular payment.

Below that is a table containing many common payment types and indicating how each one should be set up in Marlin HR so it is reported correctly to the ATO.

Earnings Types

Create Earnings types for payments that are not classified by the ATO as an "Allowance".

To edit or add Earnings types, select System > Earnings from the menu in Marlin HR. Double-click on an Earnings type in the list to edit it, or click on the Add icon to add a new one.

On each Earnings type there is a section titled ATO Reportable Attributes where you need to select the appropriate STP-2 reporting codes for this payment.

image.png

ATO Income Type: In this field you will always select Salary & Wages unless this payment type is to be used for a Working Holiday Maker.

The next 2 fields provide STP-2 reporting codes for a number of payment types.

If neither provide an appropriate option, select None in both of them (eg. for Standard Hours), otherwise select the appropriate option in one of them and select None in the other one.

Special Paid Leave Type:

image.png

Other Payment Type:

image.png

Tip

Click on Hint beside a field to display an explanation of each option.

Allowance Types

Create an "Allowance" type for payments that are classified by the ATO as an "Allowance".

To edit or add Allowance types, select System > Allowances from the menu in Marlin HR. Double-click on an Allowance type in the list to edit it, or click on the Add icon to add a new one.

On each Allowance type there is a section titled ATO Reportable Attributes where you need to select the appropriate STP-2 reporting codes for this payment.

image.png

The next 4 fields provide STP-2 reporting codes for different types of Allowances. You should refer to the ATO website or the table in the section below to determine the correct options to select for each type. Clicking on Hint beside a field will also provide additional explanation of the options.

Warning

If unsure, do not just select Other Allowances and General in the top 2 fields. The ATO has specifically warned employers not to use these options as a "catch all".

If the payment is for a Lump Sum Code or ETP Code, select the appropriate option in one of the bottom 2 fields and select None in the others.

If the appropriate option is in the first box, select it there and select None in all other fields.

If the correct option is Other Allowances in the top field, you will then need to make an appropriate selection in the second field as well to provide further detail.

ATO Allowance Type:

image.png

Description for OD:

image.png

ATO Lump Sum Code:

image.png

ATO ETP Code:

image.png

Payments & STP-2 Codes

Shown below are a number of common payment types with an indication of whether they should be set up in Marlin HR as an Earnings type or Allowance type and which STP-2 reporting codes should be selected.

Warning

Please verify the recommended STP-2 reporting codes with the ATO or your tax accountant.

Allowences

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Allowance – accommodation – domestic, amount does not exceed ATO reasonable amountAllowanceNot reported
Allowance – accommodation – domestic, amount exceeds ATO reasonable amountAllowanceDomestic or overseas travel allowances and overseas accommodation (allowance type RD)
Allowance – accommodation – overseas, for business purposesAllowanceOther allowances (allowance type OD) with the description G1 (General)
Allowance – accommodation – overseas, for private purposesAllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – all-purposeAllowanceTask allowances (allowance type KN)
Allowance – car – flat rateAllowanceOther allowances (allowance type OD) with the description V1 (Private vehicle)
Allowance – cents per km – for a car in excess of the ATO rate for business related travel.AllowanceCents per km allowance (allowance type CD)
Allowance – cents per km – for a car up to the ATO rate for business related travelAllowanceCents per km allowance (allowance type CD)
Allowance – cents per km – for private travel such as travel between home and work.AllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – cents per km – for vehicles other than a car such as a motorbike or van.AllowanceOther allowances (allowance type OD) with the description V1 (Private vehicle)
Allowance – confined spacesAllowanceTask allowances (allowance type KN)
Allowance – dangerAllowanceTask allowances (allowance type KN)
Allowance – dirtAllowanceTask allowances (allowance type KN)
Allowance – districtAllowanceTask allowances (allowance type KN)
Allowance – driving licenceAllowanceQualification and certification allowances (allowance type QN)
Allowance – equipment – where equipment is supplied by employee for business purposesAllowanceTool allowances (
Allowance – first aidAllowanceTask allowances (allowance type KN)
Allowance – freezerAllowanceTask allowances (allowance type KN)
Allowance – heightAllowanceTask allowances (allowance type KN)
Allowance – higher dutiesAllowanceTask allowances (allowance type KN)
Allowance – home office equipmentAllowanceOther allowances (allowance type OD) with the description H1 (Home office)
Allowance – industryAllowanceTask allowances (allowance type KN)
Allowance – InternetAllowanceOther allowances (allowance type OD) with the description H1 (Home office)
Allowance – laundry – for cleaning of approved uniforms in excess of the ATO approved limit.AllowanceLaundry allowance (allowance type LD)
Allowance – Laundry – for cleaning of approved uniforms up to the ATO approved limitAllowanceLaundry allowance (allowance type LD)
Allowance – laundry – for the cost of laundering deductible conventional clothingAllowanceOther allowances (allowance type OD) with the description G1 (General)
Allowance – laundry – for the cost of laundering uniforms for private purposesAllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – leading handAllowanceTask allowances (allowance type KN)
Allowance – liquor licenceAllowanceQualification and certification allowances (allowance type QN)
Allowance – living away from home (FBT)AllowanceNot reported – but may form part of RFBA
Allowance – localityAllowanceTask allowances (allowance type KN)
Allowance – loss of licenceAllowanceQualification and certification allowances (allowance type QN)
Allowance – meals and incidentals – domestic, amount does not exceed ATO reasonable amount.AllowanceNot reported
Allowance – meals and incidentals – domestic, amount exceeds ATO reasonable amountAllowanceDomestic or overseas travel allowances and overseas accommodation (allowance type RD)
Allowance – meals and incidentals – overseas, amount exceeds ATO reasonable amountAllowanceDomestic or overseas travel allowances and overseas accommodation (allowance type RD)
Allowance – on call – ordinary hoursAllowanceTask allowances (allowance type KN)
Allowance – on call – outside ordinary hoursEarningsOvertime (other payment type O)
Allowance – overtime meals – amount does not exceed the ATO reasonable amountAllowanceNot reported
Allowance – overtime meals – amount exceeds the ATO reasonable amountAllowanceOvertime meal allowance
Allowance – recognition of skill levelAllowanceTask allowances (allowance type KN)
Allowance – secondmentAllowanceTask allowances (allowance type KN)
Allowance – siteAllowanceTask allowances (allowance type KN)
Allowance – supervisorAllowanceTask allowances (allowance type KN)
Allowance – tools of tradeAllowanceTool allowances (allowance type TD)
Allowance – transport – for private purposesAllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – transport – payments for the cost of transport for business related travel not traceable to a historical award in force on 29 October 1986AllowanceOther allowances (allowance type OD) with the description T1 (fares)
Allowance – transport – payments for the cost of transport for business related travel traceable to a historical award in force on 29 October 1986AllowanceAward transport payments (allowance type AD)
Allowance – travel time – ordinary hoursEarningsGross (other payment type None)
Allowance – travel time – outside ordinary hoursEarningsOvertime (other payment type O)
Allowance – travel – for private purposesAllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – travel – part dayAllowanceOther allowances (allowance type OD) with the description ND (non-deductible)
Allowance – wet weatherAllowanceTask allowances (allowance type KN)
Allowance – working with children checkAllowanceQualification and certification allowances (allowance type QN)

Earnings

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Ordinary hoursEarningsGross (other payment type None)
OvertimeEarningsOvertime (other payment type O)
Penalties – public holidayEarningsGross (other payment type None)
Penalties – shiftEarningsGross (other payment type None)
Public holiday – day not workedEarningsReport as if the employee had worked (Gross and any other relevant payment types)
Rostered day off (RDO) – hours cashed out in serviceEarningsLeave type C - Note: Adjustment Leave Entries with "Cash-in Leave Hours" checkbox ticked will do this automatically.
Rostered day off (RDO) – hours takenEarningsOther paid leave (paid leave type O)
Time off in lieu (TOIL) – hours cashed out in serviceEarningsOvertime (other payment type O)
Time off in lieu (TOIL) – hours takenEarningsOther paid leave (leave type O)
Travel time – Excess, for travel outside ordinary hoursEarningsOvertime (other payment type O)
Breach of rest break paymentEarningsGross (other payment type None)
Call back paymentEarningsOvertime (other payment type O)
CommissionEarningsCommission (other payment type C)
Directors’ fees – working or non-working directorEarningsDirectors’ fees (other payment type D)
Flexi time – hours worked and takenEarningsGross (other payment type None)
Identifiable overtime component of annualised salaryEarningsOvertime (other payment type O)

Back Pay

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Back pay – accrued less than 12 months before date of paymentAllowance / EarningsThe payment type that matches the payment. For example, back pay of ordinary pay = gross, back pay of higher duties allowance = task allowance (allowance type KN).
Back pay – accrued more than 12 months before date of paymentAllowanceLump sum E
Back pay – total is below Lump sum E thresholdAllowance / EarningsThe payment type that matches the payment. For example, back pay of ordinary pay = gross, back pay of higher duties allowance = task allowance (allowance type KN).

Bonuses

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Bonus – ChristmasEarningsBonus (other payment type B)
Bonus – ex-gratia, in respect of ordinary hours of workEarningsBonus (other payment type B)
Bonus – paid to employee that has resigned to encourage withdrawal of resignationAllowanceReturn to work payment (Lump sum W)
Bonus – paid to end industrial actionAllowanceReturn to work payment (Lump sum W)
Bonus – paid to ex-employee to returnAllowanceReturn to work payment (Lump sum W)
Bonus – performanceEarningsBonus (other payment type B)
Bonus – referralEarningsBonus (other payment type B)
Bonus – relating entirely to time worked outside ordinary hoursEarningsOvertime (other payment type O)
Bonus – retentionEarningsBonus (other payment type B)
Bonus – sign-onEarningsBonus (other payment type B)

Leave

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Leave – annual – cashed out in serviceEarningsLeave type C - Note: Adjustment Leave Entries with "Cash-in Leave Hours" checkbox ticked will do this automatically.
Leave – annual – takenEarningsOther paid leave (paid leave type O)
Leave – bereavementEarningsOther paid leave (paid leave type O)
Leave – carer’sEarningsOther paid leave (paid leave type O)
Leave – community serviceEarningsAncillary and defence leave (paid leave type A)
Leave – compassionateEarningsOther paid leave (paid leave type O)
Leave – defenceEarningsAncillary and defence leave (paid leave type A)
Leave – domestic violenceEarningsOther paid leave (paid leave type O)
Leave – familyEarningsOther paid leave (paid leave type O)
Leave – firefighting serviceEarningsAncillary and defence leave (paid leave type A)
Leave – gardeningEarningsOther paid leave (paid leave type O)
Leave – jury dutyEarningsAncillary and defence leave (paid leave type A)
Leave – long service – cashed out in serviceEarningsLeave type C - Note: Adjustment Leave Entries with "Cash-in Leave Hours" checkbox ticked will do this automatically.
Leave – long service – takenEarningsOther paid leave (paid leave type O)
Leave – paid on termination – annual leave or leave loading accrued after 17 August 1993, termination for genuine redundancy, invalidity or early retirement scheme reasonsAllowanceLump sum A, type code R
Leave – paid on termination – annual leave or leave loading accrued after 17 August 1993 paid on a normal terminationEarningsUnused leave on termination (paid leave type U). Note: Termination Pay will apply this automatically.
Leave – paid on termination – long service leave accrued after 17 August 1993 paid on a normal terminationEarningsUnused leave on termination (paid leave type U). Note: Termination Pay will apply this automatically.
Leave – paid on termination – long service leave that accrued before 16 August 1978AllowanceLump sum B
Leave – paid on termination – long service leave that accrued between 16 August 1978 and 17 August 1993.AllowanceLump sum A, type code T
Leave – paid on termination – unused annual leave or leave loading paid on termination that accrued before 17 August 1993AllowanceLump sum A, type code T
Leave – parental – employer paidEarningsPaid parental leave (paid leave type P)
Leave – parental – government paid (GPPL)EarningsPaid parental leave (paid leave type P)
Leave – personal – cashed out in serviceEarningsLeave type C - Note: Adjustment Leave Entries with "Cash-in Leave Hours" checkbox ticked will do this automatically.
Leave – personal – takenEarningsOther paid leave (paid leave type O)
Leave – RSPCAEarningsAncillary and defence leave (paid leave type A)
Leave – sickEarningsOther paid leave (paid leave type O)
Leave – State Emergency Service (SES)EarningsAncillary and defence leave (paid leave type A)
Leave – studyEarningsOther paid leave (paid leave type O)

Loading

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Loadings – annual leave loading (demonstrably referable to a loss of overtime)EarningsOvertime (other payment type O)
Loadings – annual leave loading (standard)EarningsOther paid leave (paid leave type O)
Loadings – casual loadingEarningsGross (other payment type None)

Workers Compensation

Payment TypeEarnings / AllowenceSTP Pahse 2 Reporting Codes
Workers’ compensation – no work is performedEarningsWorkers Compensation W
Workers’ compensation – paid after terminationEarningsWorkers Compensation W
Workers’ compensation – top-up, no work is performedEarningsWorkers Compensation W
Workers’ compensation – top-up, work is performedEarningsGross (other payment type None)
Workers’ compensation – work is performedEarningsGross (other payment type None)

Was this article helpful?

What's Next