Webinar 1: Understanding the basics – what it is, how it works · 2019. 3. 6. · Understanding...
Transcript of Webinar 1: Understanding the basics – what it is, how it works · 2019. 3. 6. · Understanding...
Webinar 1:
Understanding the basics –what it is, how it works
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Payroll Tax Webinars
Webinar One Understanding the basics –what it is, how it works
Webinar Two Allowances, FBT, exemptionsand rebates
Webinar Three Contractors
Webinar Four Groupings
Agenda
• What is payroll tax?– Thresholds and rates
• What is taxable?• Exclusion and exempt employers• Interstate (and overseas) workers
Payroll Tax in a Nutshell
• Self assessed tax • Usually paid monthly• Apportioned tax free threshold amount
for part year/interstate employers• Harmonised legislation• Employees or ‘deemed employees’• Liable employers are required to
apply for registration
Tax Free Threshold – 2018-19
NSW SA VIC QLD$850,000
1 Jul 18 to 30 Jun 19
$900,0001 Jul 19 to 30 Jun 20
$600,000#1 Jul to 31 Dec 18
$1,500,000#1 Jan to 30 Jun 19
$650,000 $1,100,000*
NT TAS WA ACT$1,500,000* $1,250,000 $850,000* $2,000,000Liability in a state exists if:1. Services are performed wholly in that state; and2. Australia wide wages exceeds threshold
* Note: reduces as wages increase# Note: SA has a split threshold during 2018-19
Tax Free Threshold
Employing for full financial year
Employing for half financial year
Employing for three quarters of
financial year
Receive full tax free
threshold
Receive ¾ tax free threshold
Receive half tax free threshold
Tax Free Threshold
Vic $600,000
WA$300,000
Tas $600,000
Total Australian Wages $1,500,000AdjustedTasmanianTax Free Threshold:
$600,000X $1,250,000
$1,500,000
= $500,000
AdjustedVictorian Tax Free Threshold:
$600,000X $650,000
$1,500,000
= $260,000
Adjusted Western AustraliaTax Free Threshold:
$300,000X $850,000
$1,500,000
= $170,000
Payroll Tax Rates – 2018-19
NSW SA VIC QLD5.45% Varies from
0% to 4.95%#depending on wages paid for full
financial year
4.85%Metro
2.425%Regional
4.75%
NT TAS WA ACT5.5% 4%
(wages $1,250,001 to $2,000,000)
6.1%(wages $2,000,001 and above)
5.5%-6.5% 6.85%
# Note: Effective from 1 January 2019
What is Taxable?
Liable Wages
Salaries & Allowances
Apprentice payments
(not all jurisdictions)
Leave
Super, bonuses &
commissionsFringe
benefits
Termination payments
Shares & Options, & Directors
Fees
Apprentices
SA NSW TAS VICTaxable Taxable#
Rebate*Taxable#
Rebate*Taxable#
QLD NT WA ACTExempt#
Rebate*Taxable# Exempt# Taxable#
#Be mindful that some conditions apply – contact relevant revenue
office for more information
*Rebate may also be available -contact relevant revenue office
for more information
Leave Payments
Leave payments are taxable
Annual leave
Sick leave
Long service leave
Leave loading Maternity and adoption leave are not taxable
Director’s Fees
Director’s Fees are taxable
Profit Distribution
Non-working Directors
Regardless of where paid to
Working Directors
Shares & Options
Value of shares or options on ‘the relevant day’ LESS any consideration paid by employee
Grant Date Vesting Date
Market value or amount determined by Income Tax Assessment Act 1997
Superannuation Contributions
All pre-tax superannuation contributions are taxable
Employees Deemed employees
Company directors
SGCamounts
>SGC amounts
Salary sacrifice
Top-up contributions
Termination Payments
Taxable
All leave paid on termination
Director termination
Contractor termination
Income tax free components of a genuine redundancyOR early retirement scheme
Employee termination payments
Pay in lieu
Contract payouts
Golden handshakes
Severance payments
Exemptions
Fire & Emergency Services Duty Some conditions may vary
between states and territories –please check for finer details with
the relevant revenue officeWorker’s Compensation
Maternity & Adoption Leave
Defence Force Reserves Duty
Exempt Employers
PBI & charitable
organisations*
Public hospitals
Non-profit private
hospitals
Non-profit private schools
Government – local**, Governors and foreign representatives staff
In some states you need to apply for an exemptionCheck with the relevant revenue office
*exemption criteria applies to charitable organisations in theNorthern Territory, New South Wales, Queensland, Victoria and Western Australia
**not available in Tasmania
Where are Wages Taxable?
If the work is performed solelyin one jurisdiction
in a month
Wages taxable in that jurisdiction
General Rule
An area of confusion with payroll tax is how to treat wages paid to workers who work in other states/territories or overseas
Interstate Workers
The work is performed in
more than one state/territory
(and/or overseas) in a month
Wages are taxable where
The employee’s principal place of residence is located
The employer’s business is registered
1
2If no principal place of residence then
If employer’s business is not registered in Australia or does not have a
principal place of business (PPB) then
Interstate Workers
The work is performed in
more than one state/territory
(and/or overseas) in a month
Wages are taxable where
The bank account the employee’s wages are paid into
Where the work is predominately performed
3
4
If not paid into an Australian bank account then
Overseas Workers
Employees working overseas
> 6 months: exempt
< 6 months: where paid?
Employees from overseas
Work performed only in one stateLiable in that state
Work performed in more than one stateTest 2 to 4 applies
Revenue Offices
Further information
payrolltax.gov.auNSW SA VIC QLD
revenue.nsw.gov.au revenuesa.sa.gov.au sro.vic.gov.au qld.gov.au/osr
NT TAS WA ACTtreasury.nt.gov.au sro.tas.gov.au osr.wa.gov.au revenue.act.gov.au
Youtube.com/users/RevenueOfficesAU
Payroll Tax Webinars
Webinar One Understanding the basics –what it is, how it works
Webinar Two Allowances, FBT, exemptionsand rebates
Webinar Three Contractors
Webinar Four Groupings