COVID-19 payroll tax relief explained
Australia's state and territory governments have developed a variety of plans to help address economic hardship tied to COVID-19. Understanding these plans can help your business gain the full benefits owed to it and reduce the pressures created by the disease and the need to limit its spread. Let's review each state and territory's plan for relief specifically as it relates to payroll taxes.
Australian Capital Territory
The Australian Capital Territory detailed three specific measures to address the financial issues many businesses are facing due to social distancing restrictions and the many other types of economic fallout:
- Businesses directly influenced by the prohibited activities list issued by the National Cabinet can seek out a six-month payroll tax waiver. That waiver covers the period from April through September 2020.
- Businesses based in the ACT that pay wages across Australia up to $10 million can put off their 2020-2021 payroll tax payment, with no interest or penalty, until 1 July 2020. Companies must first complete an eligibility check through the ACT Revenue Office.
- Construction industry businesses can apply to put off their payroll tax payments for the period of April-September 2020, with no interest or penalty involved, as long as payment is made by 1 October 2020.
Find helpful links to applications and eligibility checks for these programs and more information about requirements at the ACT website page for payroll tax relief.
New South Wales
The NSW government has approved three tax relief strategies:
- All businesses can defer payroll tax payments until October 2020. They can choose to pay in full or set up instalment plans.
- Businesses with total grouped Australian wages of $10 million or less will benefit from a 25 per cent reduction in payroll tax liability once their annual reconciliation is lodged by the normal due date.
- The tax-free threshold will rise to $1 million at the start of the new financial year on 1 July 2020.
Find more specifics, requirements and actionable information on the NSW Revenue page for COVID-19 and payroll tax.
The Northern Territory Government offers a variety of payroll tax relief measures, including a March-August payroll tax waiver for businesses listed on the DTBI Business Hardship Register with total taxable Australian wages below $7.5 million.
Learn more about other relief payments and eligibility, including applying for a listing on the DTBI Business Hardship Register, visit this page produced by the Northern Territory Department of Treasury and Finance.
The Queensland state government developed three COVID-19 tax relief measures tied to payroll, including a payroll tax waiver from March through August 2020 for businesses DTBI Business Hardship Register
- Payroll tax refunds for two months. This program ended the application process on May 31, 2020.
- A three-month payroll tax relief program. This plan also ended applications on May 31, 2020.
- A 2020 payroll tax deferment that covers the entire calendar year. This program is still open, with applications closing on 31 December, 2020.
Find a link to the payroll tax deferment application, requirements and more information on the Business Queensland page for coronavirus payroll tax relief.
The government of South Australia approved three COVID-19 tax relief structures for businesses in the state:
- A $10,000 cash grant program for small businesses and non-profits that faced large impacts due to COVID-19.
- Federal JobKeeper payments are exempt from payroll tax.
- Businesses with Australian grouped wages up to $4 million will benefit from a six-month payroll tax waiver. Companies that paid Australian annualised grouped wages below $4 million in the 2018-2019 financial year do not need to apply – the Department of Treasury and Finance will notify them automatically.
- Businesses with Australian annualised grouped wages above $4 million that can demonstrate adverse affects from COVID-19 can apply for a six-month deferral. The period covered is April-September 2020. Taxes will become due in October 2020.
Find links to details about eligibility, application information, requirements and more, visit the RevenueSA page for COVID-19 relief.
The Tasmanian Government offers a waiver for 2019-2020 payroll tax for employers with Australian wages of up to $5 million annually, along with waivers for the hospitality, tourism and seafood industries and other benefits. Learn more about eligibility and application as well as additional details on this page from the State Revenue Office of Tasmania.
The government of Victoria approved two payroll tax relief programs:
- Businesses with Victorian taxable wages at or under $3 million will have their payroll tax waived, and defer payments for the first quarter of the 2020-2021 financial year. Companies that already paid can claim refunds.
- Additional payments to workers made on top of the JobKeeper program are exempt from payroll tax.
Learn more about requirements, applications for refunds and more on this Victoria State Revenue Office page.
The government of Western Australia put four relief measures related to payroll taxes into action:
- The payroll tax threshold will increase to $1 million on 1 July 2020.
- A four-month (April through June) payroll tax waiver for businesses with Australian taxable wages below $7.5 million as of 30 June 2020.
- An automatic grant of $17,500 for businesses with annual Australian taxable wages between $1 million and $4 million during the 2018-2019 financial year.
- A payroll tax exemption for wages paid by businesses subsidised by the federal JobKeeper payment.
Find more information on the Western Australia government page for COVID-19 payroll tax relief.
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