Payroll Tax SA

This is general information and not advice. For more complete information go to the South Australian State Revenue Office, Revenue SA

2021 and 2022 Budgets

The 2020-21 Budget introduced a 12 month exemption from payroll tax on wages paid to apprentices and trainees who commenced a relevant training contract between 10 November and 30 June 2021.

The 2021-22 Budget extends the program for 12 months to apply to new training
contracts entered into up to 30 June 2022.

Further info: South Australia Budget website

COVID-19 (Coronavirus) Relief Measures

The South Australian Government announced that businesses and business groups with annual Australian (grouped) wages up to $4 million (based on declared wages for 2018-19) will receive a 6 month payroll tax waiver for the return periods of March to August 2020.

Businesses and business groups with wages over $4 million can apply to defer their payroll tax.

For more information see RevenueSA Covid19 relief.

Payroll Tax Rate in South Australia

Since 1 July 2009 the general rate has been 4.95% of taxable wages. Prior to that it was 5%.

Payroll Tax Threshold in South Australia

The payroll tax annual threshold is $1.5 million from 1 January 2019. Prior to that it was $600,000.

Note that while the threshold for payroll tax has increased to $1.5 million, the maximum deduction entitlement remains unchanged at $600,000.

The calculated annual liability is compared to the total of monthly returns, resulting in either a balance to pay, or a refund due.

For monthly returns and the necessary monthly tax calculations, the annual deduction is converted to a monthly deduction of $50,000 and registration is required for the month that that occurs.

RevenueSA recommends registration when the payroll consistently exceeds $11,538 per week.

See further: Payroll Tax Rates and Thresholds Revenue SA

Due dates

Monthly returns and payment are generally due seven days after the end of each month
An annual return and reconciliation is required by 21 July each year, and is required to be electronically lodged through www.revnet.sa.gov.au.

Definition of wages

The payroll tax base include wages and salaries, the definition of which is expanded to include a range of contractor payments, allowances and fringe benefits as they are defined under the Fringe Benefits Tax Assessment Act 1986. Included are payments to third parties for services provided by and employee (or director) to an employer.

To determine the taxability of contractors and employment agency payments, an online decision tool is available.

South Australia payroll tax exemptions

There are a number of exemptions and exclusions from payroll tax in South Australia. Exemptions may be based on the status of the employer, or the nature of the wages.

Workers compensation payments made in accordance with the Return to Work Act 2014 are not subject to payroll tax.

See further: Payroll Tax Exemptions

Allowances

Generally, all allowances are taxable for payroll tax purposes but motor vehicle and overnight accommodation allowances are not considered wages unless they exceed the exempt component. The exempt rates for motor vehicle and accommodation allowances are here.

Employment Agencies

An employment agency arrangement typically involves:

the service provider contracting with the employment agent, and
the employment agent contracting with the client.

The Payroll Tax Act 2009 provides that an ‘employment agency contract’ is not a ‘relevant contract’, and therefore payments are not exempt under the contractor provisions. Consequently a payroll tax liability remains with the agency.

For further information, the Employment Agency rules and variations of circumstances are described here

Grouping provisions

Payroll values of grouped entities are added together for taxing purposes so that the deductible threshold is only available once within groups of related parties. Relationships (and hence aggregation of payroll amounts) are determined on the basis of :

Related companies according to the Corporations Act definition
Use of common employees
Common control by one or more persons
Tracing of aggregate controlling interests

There are grouping exclusions available on the exercise of the Commissioner’s discretion, and there is more detailed information about groups here.

SA Payroll Tax Registration

Electronic registration and payment of payroll tax is required by the 7th day of the month following the month in which wages exceed the deduction threshold level.

For more information on payroll tax registration in South Australia go here.

Further information

This page was last modified 2021-06-23