A common question asked by new businesses building a workforce is what payroll tax they can expect to pay in Australia. Payroll tax in Australia is calculated based on individual factors in your business, which can be easily calculated and lodged by i3Group’s team of payroll professionals. If you are preparing for tax time or projecting your payroll commitments for the financial year ahead, here is a guide to payroll tax due dates and payroll tax relief that you may be eligible for.

Understanding payroll tax in Australia

Payroll tax is a state or territory tax that is based on the total monthly wages paid by the business. This self-assessed amount is collected by the state in which the business presides with varying tax rates and tax thresholds, and is only paid if the total wage amount exceeds the tax-free threshold. There are various tax exemptions that business may qualify for, which can be assessed by the revenue office in the state or territory your business operates in.

State and territory payroll tax thresholds 

Identical businesses operating in different states may find they pay significantly more or less payroll tax, and the payroll tax thresholds of these states and territories are subject to increase or decrease each year. Outsourcing your payroll to i3Group will afford your business absolute transparency on all tax obligations, with our experienced payroll team keeping up to date with all national and state-based payroll legislation changes. 

The payroll tax in Australia is as follows:

 

STATECURRENT PAYROLL TAX RATE*MAX. THRESHOLD
ACT6.85%$166,666.66/month

$2,000,000/year

NT5.5%$125,000/month

$1,500,000/year

NSW4.85%$1,200,000/year
QLD4.75%$108,333/month

$1,300,000/year

SA4.95%$125,000/month

$1,500,000/year

TAS4%$1,250,000/year
VIC4.85%

2.425% for regional employers

$54,166/month

$650,000/year

WA5.5%$83,333/month

$1,000,000/year

(other tiers applicable)

*Payroll tax rates are accurate as of June 2021

Australian payroll tax due dates

i3Group’s management of your payroll function guarantees all declarations are lodged on time and calculated with the necessary compliances, including your payroll tax in Australia. The annual reconciliation is the same for every state, falling at the end of the financial year. Monthly payments, however, are due at varying times with varying leniencies for late lodgements. Our i3Group payroll consultants have expert knowledge of requirements across all states and territories in order to support your ongoing state-based payroll obligations. 

You can also visit your state or territory website to understand what your Australian payroll tax due dates are, and keep abreast of any tax rate and tax threshold changes. From large enterprise payroll or small businesses, payroll tax should be adhered to so that you can avoid further complications at the end of the financial year or the need for further documentation and reporting to the Australian Tax Office.

Are there exemptions for payroll tax in Australia?

Like any tax-related commitment, there are circumstances where payroll tax relief and payroll tax exemptions apply. Businesses that operate as a charity or not-for-profit are often exempt from the same payroll tax rate due to their funding coming from the state that will ultimately receive said tax. Businesses that are eligible for this payroll tax exemption or others should already have applied for this tax exemption or would not have been required to enrol for payroll tax when the business commenced.

Businesses that are required to pay payroll tax in Australia will still have exemptions within that obligation. These fall under minimum thresholds, wherein calculation methods and reduced rates can be applied to the tax portion and only paid when a minimum threshold is met or exceeded. Our i3Group payroll consultants can work with you to understand those thresholds and work to receive payroll tax relief and exemptions where possible.

~

If you would like to discuss your payroll tax due dates, payroll tax relief or any commitments that you are responsible for as an Australian business – contact i3 Group today.