Case example: Baker Street Pty Ltd
- Please check website for the updated rate
The payroll tax rate is 5.45%.
The payroll tax threshold for 2017-18 (July – June) is $750,000.
The monthly threshold amounts are:
|Days in the month||Threshold|
The monthly threshold is calculated using the number of days in the month, divided by the number of days in the year, multiplied by the threshold.
To view rates and thresholds for previous years, visit the rates and thresholds page.
|What payments are liable for payroll tax?||What payments are not liable?|
Payments made by the court system are not liable. Payments made to an employee by their employer while on jury duty are liable, even if you are partly or fully compensated from the court
If in the course of work an employee incurs an expense and is reimbursed for that expense against receipts, then the payment is not a wage. You must be able to account for the payments either as an advance which is later adjusted against receipts, or payments against receipts. Any payments that do not have documentation are not accepted as reimbursements and will be liable.
Payments made by an insurance company to an employee on workers compensation are not liable.
Make up payments (the difference between the compensation payments and an employee’s regular pay) paid by the employer are liable.
See extensive list below:
additional items that are not liable, exempt from payroll tax
|Wage type||Liability status||Comments|
|Aboriginal Persons (payments made to)||Exempt under certain conditions||Wages exempt if an approved project|
|Accommodation allowances||Exempt component applies|
|Adoption leave||Exempt up to 14 weeks full-time or equivalent period if paid at a reduced rate of pay.||Paid in addition to normal leave|
|Defence Force payments||Exempt||For time taken as military leave|
|Dividends||Not liable||Return on investment is not liable|
|Emergency operations||Exempt||For wages paid to a volunteer member involved in emergency operations|
|Gifts unrelated to service||Not liable||Fringe benefits tax limits apply|
|Jury Duty (court payments)||Not liable||Payments made by the court system to an employee are not liable wages|
|Maternity leave||Exempt up to 14 weeks full-time or equivalent period if paid at a reduced rate of pay.||Paid in addition to normal leave|
|Motor vehicle allowances paid as flat or fixed amount||Exempt component applies||Applies to business use of private vehicles|
|Motor vehicle allowances paid on per kilometre basis||Not liable||Applies to business use of private vehicles. The car expense payment must be exempt under the Fringe Benefits Tax Assessment Act 1986|
|Paid parental leave (PPL) paid by the Commonwealth Government||Not Liable|
|Partnership drawings||Not liable|
|Paternity leave||Exempt up to 14 weeks full-time or equivalent period if paid at a reduced rate of pay.||Paid in addition to normal leave|
|Portable long service leave fund payments||Not liable|
|Redundancy benefit scheme payments||Not liable||Payments made into or out of scheme|
|Reimbursements||Not liable||Must be a business expense which is accounted for|
|Subscriptions||Exempt component applies||As per Fringe Benefits Tax Assessment Act 1986|
|Trust distributions||Not liable|
|Volunteer fire-fighters||Exempt||For wages paid while involved in bushfire fighting activities|
|Workers compensation||Not liable||Only statutory compulsory amounts are not liable|