STP finalisation 2026

STP finalisation is due by 14 July 2026. Learn key deadlines, payroll checks and common errors to help stay compliant.

For many businesses, the end of the financial year doesn't end on 30 June.
Once the final pay run has been processed, employers still need to complete one critical compliance obligation: Single Touch Payroll (STP) finalisation. 

This process confirms to the Australian Taxation Office (ATO) that the payroll information you've reported throughout the year is complete, accurate and ready for employees to use when lodging their tax returns. The ATO requires most employers to finalise their STP data by 14 July 2026.

While the process may seem straightforward, even small errors can create headaches for both employers and employees. The good news is that a few proactive checks throughout the year can help ensure a smooth finalisation process and reduce the risk of compliance issues later.

What is STP finalisation and why does it matter?

STP finalisation is the year-end declaration that confirms the payroll information submitted to the ATO during the 2025–26 financial year is complete and correct.

Once finalised, employees' income statements in myGov are marked as "Tax ready", allowing them to lodge their tax returns using information reported directly from your payroll system. 

Failure to finalise on time can delay employees' tax returns and may result in ATO follow-up action.

STP finalisation deadlines for the 2025–26 financial year

The standard STP finalisation deadline for most employers is:

14 July 2026

This applies to businesses reporting arm's-length employees through STP. 

30 September 2026

If you are a small employer with 19 or fewer employees and have a mix of arm's-length and closely held payees, you generally have until 30 September 2026 to finalise your closely held employees.

Payee tax return lodgement date

For small employers whose workforce consists solely of closely held payees, STP finalisation is due by the payee's income tax return lodgement due date. 

STP finalisation checklist: Key payroll compliance checks before you lodge

Before you click "finalise" in your payroll software, taking the time to perform several reconciliation checks can save significant time and effort later.

1. Confirm you are finalising the correct financial year

   One of the most common errors reported by the ATO is employers accidentally finalising the wrong financial year.

   When completing your declaration, ensure you are finalising the 2025–26 financial year, covering payroll activity from 1 July 2025 to 30 June 2026. 

2. Reconcile your payroll figures

   Your STP figures should align with your internal payroll and accounting records.
   Review and reconcile:
   •    Gross wages
   •    PAYG withholding (tax withheld)
   •    Superannuation obligations

   Compare these amounts against your payroll reports and the information included in your STP finalisation summary.

   At the employee level, review year-to-date balances to ensure each employee's earnings and withholding amounts reconcile correctly.

3. Review all employee records
   Accurate employee information is just as important as accurate payroll figures.

   Check that active and terminated employees have:
   •    Correct addresses
   •    Valid Tax File Numbers (TFNs)
   •    Accurate dates of birth
   •    Current employment details

   These details directly affect the accuracy of STP reporting and employee income statements.

4. Verify salary sacrifice reporting

   STP Phase 2 reporting requires salary sacrifice arrangements to be correctly disclosed.

   Errors often occur when salary sacrifice categories are not configured correctly within payroll software or are incorrectly mapped to reporting categories. The ATO specifically requires salary sacrifice amounts to be reported separately within STP reporting. 

5. Report additional required amounts

   Where applicable, ensure you have included:
   •    Reportable employer superannuation contributions (RESC)
   •    Reportable fringe benefits amounts (RFBA)

   These amounts can impact employees' tax positions and government benefit assessments, making accuracy essential. 

Common STP errors employers should look for

Many STP discrepancies can be traced back to a small number of recurring issues.

Unreported or failed pay runs
A pay event may not have successfully lodged with the ATO or could have been missed entirely.

The ATO identifies missed reports as a common STP reporting issue. When this occurs, year-to-date balances may not be accurate, and the missing report should be corrected as soon as possible.

Incorrect payroll category setup
Payroll systems rely on accurate setup and mapping.

If reporting categories, income types, allowances or deduction codes have been configured incorrectly, employee income statements may not reflect the correct information.

Software changes during the year
If you changed payroll software or employee payroll IDs during the financial year, additional review may be required to ensure employee income is not duplicated or overstated.

Employee data errors
Outdated employee information, particularly TFNs and personal details, can lead to reporting inconsistencies and employee frustration during tax time.

For a more detailed list of reporting issues and error codes, employers can refer to the ATO's STP reporting issues and errors guidance.

STP tips from our business advisers: Making STP finalisation easier each year

At PKF, our business advisers regularly work with businesses that leave payroll reviews until July, creating unnecessary pressure during an already busy period.

To simplify future STP finalisations, consider:

• Schedule quarterly payroll reconciliations
  Rather than waiting until year-end, perform quarterly checks of gross wages, PAYG withholding and superannuation. Small discrepancies are far easier to correct when identified early.
• Maintain a payroll governance process
  Document who is responsible for payroll reviews, approvals and reconciliation activities. Strong governance reduces the likelihood of errors slipping through the cracks.
• Keep employee records up to date year-round
  Encourage employees to notify payroll teams promptly when personal circumstances change, rather than trying to update records during finalisation season.
• Review payroll system settings after legislative changes
  Award updates, superannuation rate increases and tax changes can all impact payroll accuracy. Conducting regular payroll health checks helps ensure your software remains compliant.
• Don't ignore warnings and exceptions
  Payroll systems often flag validation issues throughout the year. Investigating these promptly can prevent major reconciliation problems at year-end.

What if you discover an STP error after finalising?

Mistakes can happen.

The important thing is to address the issue as soon as it is identified.

The ATO allows employers to amend STP information after finalisation. If an error is discovered, lodge an amendment through your STP-enabled payroll software and notify affected employees, particularly if they have already lodged their tax return. 
Taking prompt corrective action is generally viewed more favourably than allowing inaccuracies to remain unresolved.

Need help with STP finalisation?

STP finalisation is more than a compliance exercise. It is an opportunity to validate the integrity of your payroll data; identify potential risks and ensure employees have confidence in the information reported to the ATO.

If you're unsure whether your payroll data reconciles correctly, have concerns about salary sacrifice reporting, or need assistance resolving payroll discrepancies, PKF's business advisory team can help.

Our team works with businesses of all sizes to review payroll processes, improve payroll compliance controls and ensure STP obligations are met accurately and on time.

Our clients' frequently asked questions