Gear tooth faults significantly affect the meshing stiffness between gears and, consequently, the dynamic response of gearboxes. Accurate gear mesh stiffness (GMS) modelling is essential for studying tooth faults’ influence in a condition-based maintenance context. This work presents the fault modelling portion of the generalised GMS framework described in the first of the two parts. Four distinct fault models—root cracks, chips, spalls, and pits—are implemented within the GMS framework, creating an environment where different fault types can be compared. The framework further provides a robust mechanism for generating labelled fault datasets, facilitating the development of hybrid data-driven and physics-based condition monitoring approaches. Fault models are integrated into the generalised stiffness model by modifying key stiffness parameters such as the contact length, effective tooth height, tooth’s cross-sectional area and area moment of inertia. The model can introduce various fault types on individual teeth, with each tooth supporting only one fault type at a time. However, different faults can be applied to different teeth within the same gear, allowing for complex fault distributions that resemble real-world gearbox degradation. By consolidating fault modelling into a single structure, this work advances the capabilities of gearbox fault analysis and lays the foundation for future extensions and applications. This work is released with the corresponding open-source Python code at: https://github.com/LukevanEyk/Gearbox-Simulator .