As an employer in NSW, you must pay payroll tax on your employee wages if, during any one month, your total Australian wages exceed the monthly threshold.
The 2015-16 monthly thresholds are:
With a payroll tax rate of 5.45% in NSW charged on wages and benefits in excess of these thresholds, the amount of payroll tax paid in a financial year can be substantial.
Each financial year, liable employers are required to lodge an annual reconciliation which provides an opportunity to rectify any underpayments or overpayments during the year.
Given the potential cost of payroll tax to your business it is worthwhile spending some time to get the numbers right.
If you are already registered for payroll tax or your taxable wages exceed $750,000 for the year ended 30 June 2015, you have until the 21st of July 2015 to lodge your annual return/reconciliation through the Office of State Revenue (OSR).
As a reminder, employers are required to register for payroll tax within seven days after the end of the month in which they exceed the monthly tax-free threshold.
For payroll tax purposes, wages include:
Please be aware there are specific rules that apply to provide a single threshold for group employers. These generally exist where there are common employees or common ownership between business entities.
In addition, where an employer has employees in multiple states the threshold is effectively shared between states which could effectively reduce the tax free threshold in NSW.
For more information about payroll tax visit the OSR website here. Alternatively, for specialist advice or to arrange a payroll tax review for your business, speak with your local Boyce accountant.
Source: Office of State Revenue - www.osr.nsw.gov.au
