Nicholas Kohler Director

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October 2023

Newsletter; State payroll tax harmonisation & contractor doctors

SA, QLD, NSW & VIC recently aligned their payroll tax legislation (while WA elected not to make any changes to their existing legislation).

Payroll tax is an additional payment required by each state government when a business employs over certain wage thresholds:

                                Threshold                            Rate

ACT                        $2,000,000                           6.85%

SA                           $1,500,000                           variable to 4.95% at $1,700,000

NT                          $1,500,000                           5.50%

QLD                        $1,300,000                           4.75%

TAS                        $1,250,000                           4.00% (6.10% over $2,000,000)

NSW                      $1,200,000                           5.45%

WA                         $1,000,000                           5.50%

VIC                         $700,000                              4.85%

As a part of the harmonisation (and recent court cases), doctors who operate as independent contractors are now counted as employees for payroll tax purposes and the practices are liable to pay payroll tax on their payments.

Queensland and SA initially offered temporary amnesties with Queensland now issuing a ruling to exempt General Practitioners from payroll tax (where doctors receive patient fees directly then pay a service fee to the practice).  The exemption does not yet extend to other medical specialists and allied health professionals.  Hopefully there are more changes to come (the abolishment of payroll taxes completely would be welcomed by many!).

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