NSW State Government – COVID-19 Payroll Tax Relief

The NSW state government has announced a number of relief measures for employers subject to Payroll Tax.

Below are the measures based on whether your annual grouped payroll is below or above $10 million for the 2019/20 financial year.

Relief for businesses with grouped Australian wages of no more than $10 million

Payroll tax businesses whose total grouped Australian wages for the 2019/20 financial year are no more than $10 million will have their annual tax liability reduced by 25% when they lodge their annual reconciliation, which is due on 28 July.

For those businesses who lodge and pay monthly and whose total Australian wages will be no more than $10 million for the current financial year, no payment for the months of March, April or May 2020 will be required.

These businesses will also have the option of deferring these payments for an additional three months and more information will be provided on the deferral arrangements in the future.

When lodging your annual reconciliation, you will still need to provide wage details paid in these months and will receive the benefit of a 25% reduction in the amount of tax you would have had to pay for 2019-20.

 

Relief for businesses with grouped Australian wages of over $10 million

Payroll tax businesses whose total grouped Australian wages for the 2019/20 financial year are over $10 million, will have the option of deferring the payment of payroll tax for up to six months.

These businesses will not need to make their payment for the March period, normally due on 7 April 2020.

More information will be provided on the deferral arrangement in the future.

 

Threshold increase for the 2020/21 financial year

The payroll tax-free threshold will increase from $900,000 to $1 million for the financial year commencing on 1 July 2020.

A reminder that payroll tax is a state based tax that is assess on the wages paid of payable to employees by an employer (or group of employers) whose total Australian taxable wages exceed the threshold amount.

Each state and territory has its own payroll tax legislation, with different rates and thresholds.


Published : 03 Apr 2020