The present work focuses on the generalisation of the Spectral Difference (SD) scheme to the reduced Baer-Nunziato system known as five-equation model for the simulation of two immiscible compressible fluids. This five equation model is considered with the additional Allen-Cahn regularisation to avoid both over-diffusion and over-thinning of the phase field representing the interface. Finally, in order to preserve contact discontinuities, in the reconstruction step of the spectral difference scheme, a change of variables from conservative to primitive is used. This approach is shown to be beneficial in avoiding pressure oscillations at material interfaces. An extensive series of numerical tests are proposed to assess accuracy and robustness of the present method. Both kinematic (Rider-Kothe vortex) and two-phase flow problems (Rayleigh-Taylor instability, shockdroplet interaction, Taylor-Green vortex) are considered.