Answer
From 24 September 2025, the Australian Taxation Office (ATO) updated the Study and Training Support Loans (STSL) withholding rules. The ATO released new Schedule 8 formulas and updated weekly, fortnightly and monthly STSL tax tables to reflect reduced compulsory repayment requirements and a revised calculation method. These apply to payments made on or after 24 September 2025 and run through to 30 June 2026.
- ATO: Updates to Withholding Schedule and Tax Tables
- ATO: Schedule 8 – Statement of Formulas for Calculating STSL Components
- ATO: STSL Weekly Tax Table (payments from 24 September 2025)
- ATO: Tax Tables Overview (notes on the September 2025 STSL update)
When Do Employers Need To Apply The New Tables?
Use the new STSL formulas and tax tables for payments made on or after 24 September 2025. Payments made before this date should continue to use the prior tables. The ATO materials above confirm the effective date and that the updated tables cover the remainder of the 2025–26 financial year.
Which Loans Are Covered By STSL?
STSL withholding applies when an employee has a relevant loan such as HELP, VET Student Loans, Student Start-up Loans, Australian Apprenticeship Support Loans and similar programs. Refer to the ATO tax table pages for the full list and any threshold details.
What Do I Need To Do In Lightning Payroll?
- Lightning Payroll Online and Lightning Payroll Desktop versions 2026.72 and above include the new ATO STSL formulas and tax tables.
- Ensure your software is updated to at least 2026.72 before processing pays dated on or after 24 September 2025.
- After updating, process pay runs as normal. The new STSL withholding will be applied automatically for employees who have an STSL debt recorded.
Do I Need To Reprocess Earlier Pays?
No. The ATO update applies to payments made on or after 24 September 2025. Do not adjust pays that were made before that date unless specifically instructed by the ATO or your tax adviser. If a pay period spans the changeover, use the rules that correspond to the actual payment date.
Where Can I Read The Official Details?
- ATO: Updates to Withholding Schedule and Tax Tables
- ATO: Schedule 8 – Statement of Formulas for Calculating STSL Components (PDF available from this page)
- ATO: STSL Weekly Tax Table (see also the linked fortnightly and monthly tables)
Tip: If you have any uncertainty about thresholds or repayment rates for a specific employee, check the relevant ATO STSL tax table linked above or use the ATO's tax withheld calculator.
