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Today’s session Agenda. Quick overview of Payroll Tax Taxable wages and issues to be mindful of Exemptions Common mistakes Interstate/overseas employees Allowances Employment agency provisions Contractor provisions Grouping provisions Completing the Annual Reconciliation
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Today’s sessionAgenda Quick overview of Payroll Tax • Taxable wages and issues to be mindful of • Exemptions • Common mistakes • Interstate/overseas employees • Allowances • Employment agency provisions • Contractor provisions • Grouping provisions Completing the Annual Reconciliation • Accessing the system • Due dates • Making a payment • Keeping a copy of your return Payroll Tax Annual Reconciliation
Payroll TaxA quick overview State tax • Each state has relevant legislation • Different rates & thresholds Annual Australian wages • Employers or groups of employers • Excluding exempt employers (charities, PBI’s etc) • Victoria - > $550,000 Self assessing tax Payroll Tax Annual Reconciliation
Payroll TaxTaxable Wages Salaries and wages Allowances Bonuses & commissions Directors fees Value of fringe benefits Superannuation Termination payments Shares and options Payroll Tax Annual Reconciliation
Payroll TaxExempt Payments Payments made to employees while on: Fire & emergency services duty Defence force reserves duty Maternity & adoption leave Workers compensation • “Make up pay” taxable Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes – Interstate employees Where is the work performed? • Solely in one state? • Tax payable in that state • In more than one state? • Where is the employee’s principal residence located? • Tax payable in that state • Where is the employer’s registered business address? • Tax payable in that state • Where are the wages received? • Tax payable in that state • Where were the services mainly performed? • Tax payable in that state Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes – Overseas employees Where is the work performed? • In another country? • > 6 months – exempt • < 6 months – taxable • In Australia – employee from overseas • Previous slide Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes - Allowances All allowances fully taxable except: Accommodation • Lowest capital city rate – Hobart = $227.35 (accom, meals etc) Living away from home • FBT Car • 75 cents per km exempt Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes – Employment Agency Contracts When labour is ‘on-hired’ Deemed to be an employee of the ‘employment agent’ Liability rests with ‘employment agent’ • Likely they will on-charge that cost Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes – Contractor Provisions Contracts that include the provision of labour except: Owner drivers Insurance agents Door to door sellers and 6 exemptions Contractor works not more than 90 days in financial year Services required < 180 days in financial year Services not ordinarily required Contractor engages other labour Labour ancillary Services ordinarily rendered to the public Payroll Tax Annual Reconciliation
Payroll TaxCommon Mistakes – Grouping Provisions How is a group formed: Related bodies corporate • S50 Corporations Act 2001 Use of common employees Common control • Person or persons together > 50% in each of 2 businesses • Directors – majority common • Shareholders – more than 50% in each Impact: 1 deduction across the entire group Joint & several liability Exclusion? Commissioner’s discretion Payroll Tax Annual Reconciliation
