Payroll Tax Act 2009

This Act may be cited as the Payroll Tax Act 2009.

This Act commences on 1 July 2009.

In this Act:

ABN means the ABN (Australian Business Number) for an entity within the meaning of A New Tax System (Australian Business Number) Act 1999 (Cth).

agent includes:

(a) a person who, in this jurisdiction, for or on behalf of another person outside this jurisdiction, holds or has the management or control of the business of that other person; and

(b) a person who, by an order of the Commissioner, is declared to be an agent or the sole agent for any other person for this Act and on whom notice of that order has been served.

aggregate interest, see section 78.

Australia means the States of the Commonwealth and the Territories.

Australian jurisdiction means a State or Territory.

business, for Part 5, see section 67.

category 1 to 3 purpose, for Part 4, Division 1, see section 48.

coastal waters, of the Territory, means coastal waters of the Territory as defined in section 3(1) of the Coastal Waters (Northern Territory Powers) Act 1980 (Cth).

company includes all bodies and associations (corporate and unincorporate) and partnerships.

contract, for Part 3, Division 7, see section 31.

corporation means a corporation as defined in section 9 of the Corporations Act 2001.

correct amount of payroll tax, for Part 6, see section 82(1).

corresponding payroll tax law means a law of the Commonwealth, or of a State or another Territory, relating to the imposition on employers of a tax on wages paid or payable by them or the assessment and collection of that tax.

designated group employer means a member designated for a group in accordance with section 80.

direct interest, by an entity in a corporation, see section 76.

director of a company includes a member of the governing body of the company.

educational company, for Part 4, Division 1, see section 48.

educational institution, for Part 4, Division 1, see section 48.

employer means a person who pays or is liable to pay wages, and includes:

(d) a public authority constituted under the law of the Commonwealth or of a State or Territory unless, being an authority constituted under the law of the Commonwealth, it is immune from the operation of this Act.

employment agency contract, see section 37.

employment agent, see section 37.

employment termination payment, for Part 3, Division 5, see section 27.

entity, for Part 4, Division 1, see section 48.

exempt wages mean wages that are declared by or under this Act to be exempt wages.

Note

Wages are declared to be exempt wages in various provisions. For example, see sections 50, 51, 53, 55, 56, 58, 59 and 61 to 66 and Schedule 2, Part 4, Division 1.

FBTA Act means the Fringe Benefits Tax Assessment Act 1986 (Cth).

financial year means each year commencing on 1 July.

fringe benefit means a fringe benefit as defined in the FBTA Act but does not include:

(a) a tax-exempt body entertainment fringe benefit within the meaning of that Act; or

(b) anything that is prescribed by regulation not to be a fringe benefit for this definition.

granted, for a share or option, see section 19(2).

group, see section 67.

group employer, see section 82(4).

GST means GST as defined in A New Tax System (Goods and Services Tax) Act 1999 (Cth).

indirect interest, by an entity in a corporation, see section 77.

individual employer, see section 82(4).

industrial association, for Part 4, Division 1, see section 48.

instrument includes:

interstate wages means wages that are taxable wages within the meaning of a corresponding payroll tax law.

ITAA means the Income Tax Assessment Act 1997 (Cth).

liquidator means the person who, whether or not appointed as liquidator, is required by law to carry out the winding-up of a company.

local governing body means:

(a) a council constituted, or local government subsidiary formed, under the Local Government Act 2019; or

(b) a body declared under section 19 of the Local Government Grants Commission Act 1986 to be a local governing body; or

month means the month of January, February, March, April, May, June, July, August, September, October, November or December.

non-profit entity, see section 48A.

option means an option or right, whether actual, prospective or contingent, of a person to acquire a share or to have a share transferred or allotted to the person.

paid, in relation to wages, includes provided, conferred and assigned and pay and payable have corresponding meanings.

payroll tax means tax imposed by section 6.

perform, in relation to services, includes render.

political party, for Part 4, Division 1, see section 48.

professional association, for Part 4, Division 1, see section 48.

registered business address means an address for service of notices under A New Tax System (Australian Business Number) Act 1999 (Cth) on an entity that has an ABN, as shown in the Australian Business Register kept under that Act.

relevant contract, for Part 3, Division 7, see section 32.

relevant day, for Part 3, Division 4, see section 18(3).

re-supply, for Part 3, Division 7, see section 31.

return period, in relation to an employer, means a month, or a financial year, relating to which the employer is required to lodge a return under section 87(1).

service provider, see section 37(1).

services, for Part 3, Division 7, see section 31.

share means a share in a company and includes a stapled security.

superannuation contribution, see section 17(2).

supply, for Part 3, Division 7, see section 31.

taxable in this jurisdiction, see section 11.

taxable wages, see section 10.

termination payment, for Part 3, Division 5, see section 27.

Territories means the Territory and the Australian Capital Territory (including the Jervis Bay Territory).

this jurisdiction means the Territory and coastal waters of the Territory.

trade, industry or commerce entity, for Part 4, Division 1, see section 48B.

unused annual leave payment, for Part 3, Division 5, see section 27.

unused long service leave payment, for Part 3, Division 5, see section 27.

vesting date, see section 19(3) and (4).

voting share, see section 9 of the Corporations Act 2001.

wages means wages as defined in Part 3.

Note

Wages are defined in various provisions in Part 3. For example, see sections 13, 14, 17, 18, 24, 28, 29, 30 and 66A.

The relationship between this Act and the

Taxation Administration Act 2007 (the TAA) is stated in section 5 of the TAA.

Note

Section 5 of the TAA provides that this Act (which is a taxation law as defined in the

TAA) must be read together with the TAA as a single Act. Accordingly,

Part 5 of the TAA imposes a liability to pay interest and penalty tax for a failure to pay payroll tax under this Act.

This Act binds the Crown in right of the Territory and, to the extent the legislative power of the Legislative Assembly permits, the Crown in all its other capacities.

Payroll tax is imposed on all taxable wages.

The employer by whom taxable wages are paid or payable is liable to pay payroll tax on the wages.

(2) The rate of payroll tax imposed on taxable wages paid or payable by an employer in respect of a financial year or a relevant period prior to a change in circumstances under section 84 is 6.5% if either of the following apply:

(a) if the employer is a member of a group – the total taxable wages and interstate wages paid or payable by the members of the group in respect of the year or period are equal to or greater than the threshold amount;

(b) otherwise – the total taxable wages and interstate wages paid or payable by the employer in respect of the year or period are equal to or greater than the threshold amount.

The amount of payroll tax payable by an employer is to be determined in accordance with Schedules 1 and 2.

(1) For this Act, taxable wages are wages that are taxable in this jurisdiction.

(1) For this Act, wages are taxable in this jurisdiction if:

(a) the wages are paid or payable by an employer for or in relation to services performed by an employee wholly in this jurisdiction; or

(b) the wages are paid or payable by an employer for or in relation to services performed by an employee in 2 or more Australian jurisdictions, or partly in one or more Australian jurisdictions and partly outside all Australian jurisdictions, and:

(ii) the employer is based in this jurisdiction (in a case where the employee is not based in an Australian jurisdiction); or

(iii) the wages are paid or payable in this jurisdiction (in a case where both the employee and the employer are not based in an Australian jurisdiction); or

(iv) the wages are paid or payable for services performed mainly in this jurisdiction (in a case where both the employee and the employer are not based in an Australian jurisdiction and the wages are not paid or payable in an Australian jurisdiction); or

(c) the wages are paid or payable by an employer for or in relation to services performed by an employee wholly outside all Australian jurisdictions and are paid or payable in this jurisdiction.

Note for subsection (1)(c)

Section 66A provides an exemption for wages paid or payable for services performed wholly in one or more other countries for a continuous period of more than 6 months.

(2) The question of whether wages are taxable in this jurisdiction is to be determined by reference only to the services performed by the employee in respect of the employer during the month in which the wages are paid or payable, subject to this section.

(3) Any wages paid or payable by an employer in respect of an employee in a particular month are taken to be paid or payable for or in relation to the services performed by the employee in respect of the employer during that month.

Example for subsections (2) and (3)

Wages paid to an employee in June 2010 by an employer include wages for services performed by the employee wholly in this jurisdiction in that month and a bonus for services performed by the employee during the financial year ending at the end of June 2010, which were services partly performed in this jurisdiction and partly in other Australian jurisdictions. The question of whether the wages paid in June 2010 are taxable in this jurisdiction is to be determined by reference only to services performed in that month and services performed in the previous months of that financial year must be disregarded. As a result, the wages paid in June 2010 are taxable in this jurisdiction because of subsection (1)(a).

The services performed in the previous months of that financial year will be relevant to the question of whether wages paid in each of those months are taxable in this jurisdiction, which will need to be determined having regard to subsection (1)(a) and (b).

(4) If no services are performed by an employee in respect of an employer during the month in which the wages are paid or payable to or in relation to the employee:

(a) the question of whether the wages are taxable in this jurisdiction is to be determined by reference only to the services performed by the employee in respect of the employer during the most recent prior month in which the employee performed services in respect of the employer; and

(b) the wages are taken to be paid or payable for or in relation to the services performed by the employee in respect of the employer during that most recent prior month.

(5) If no services were performed by an employee in respect of an employer during the month in which wages are paid or payable to or in relation to the employee or in any prior month:

(a) the wages are taken to be paid or payable for or in relation to services performed by the employee in the month in which the wages are paid or payable; and

(b) the services are taken to have been performed at a place or places where it may be reasonably expected that the services of the employee in respect of the employer will be performed.

(6) All amounts of wages paid or payable in the same month by the same employer in respect of the same employee are to be aggregated for the purposes of determining whether they are taxable in this jurisdiction (as if they were paid or payable for all services performed by the employee in the month in which the wages are paid or payable, or the most recent prior month, as the case requires).

Example for subsection (6)

If one amount of wages is paid by an employer in a particular month for services performed in this jurisdiction, and another amount of wages is paid by the same employer in the same month for services performed by the same employee in another Australian jurisdiction, the wages paid are to be aggregated (as if they were paid for all services performed by the employee in that month). Accordingly, subsection (1)(b) would be applied for the purpose of determining whether the wages are taxable in this jurisdiction.

(7) If wages are paid in a different month from the month in which they are payable, the question of whether the wages are taxable in this jurisdiction is to be determined by reference to the earlier of the relevant months.