If a Queensland businesses, is paying wages including superannuation, of over $1.3 million your are liable for payroll tax. This is a state tax and simply stated is 4.75% of the amount the payroll exceeds $1.3 Million.
Click here for a separate Fact Sheet on Payroll Tax Groups.
Payroll Tax in Queensland: Fact Sheet
What is Payroll Tax?
Payroll tax is a state tax in Queensland (QLD) levied on the total wages paid by an employer to its employees. It is payable when the total wages exceed a certain threshold during a financial year.
Who is liable to Pay Payroll Tax?
Employers in Queensland are required to pay payroll tax if their total annual Australian wages exceed the payroll tax threshold.
Groups of employers: If businesses are grouped, the total wages of all group members are combined to determine if the threshold is exceeded.
Payroll Tax Threshold
Annual threshold: $1.3 million (as of the 2023-24 financial year).
If an employer’s total wages are below this threshold, they are not required to pay payroll tax.
Payroll Tax Rate
Standard rate: 4.75% for employers with total annual wages of $6.5 million or less.
Higher rate: 4.95% for employers with total annual wages above $6.5 million.
Calculating Payroll Tax
Total Australian wages**: Include all wages paid within Australia, including salaries, wages, commissions, bonuses, superannuation contributions, and some fringe benefits.
Taxable wages**: Subtract the threshold amount from total wages to determine the taxable wages.
Payroll tax payable**: Multiply the taxable wages by the applicable payroll tax rate.
Examples
1. Employer with total wages of $2 million:
- Taxable wages: $2 million – $1.3 million = $700,000
- Payroll tax payable: $700,000 x 4.75% = $33,250
2. Employer with total wages of $7 million:
- Taxable wages: $7 million – $1.3 million = $5.7 million
- Payroll tax payable: $5.7 million x 4.95% = $282,150
Payroll Tax Returns
Employers must lodge monthly payroll tax returns and an annual reconciliation with the Queensland Office of State Revenue.
Due dates:
- Monthly returns: Due 7 days after the end of each month.
- Annual return: Due on 21 July following the end of the financial year.
Exemptions and Concessions
Charities and not-for-profit organizations** may be eligible for payroll tax exemptions.
Regional employers**: There may be concessional rates or rebates available for employers in regional Queensland.
If over 85% of wages are paid to staff outside the south east corner of Qld a rebate of up to 1% may be available.
Compliance and Penalties
Employers must accurately report and pay payroll tax to avoid penalties.
Penalties**: Can include fines, interest on unpaid tax, and possible legal action for non-compliance.
Key Dates
- Monthly returns: Due by the 7th of each month.
- Annual return: Due by 21 July each year.
Contact Information
Queensland Office of State Revenue
(https://www.qld.gov.au/environment/land/tax) or call 1300 300 734 for more information.
This fact sheet provides an overview of payroll tax in Queensland. Employers should refer to the Queensland Office of State Revenue for detailed information and updates.
Contact Cascade Accounting and Tax on ccs@cascadeconsulting.com.au or 07 3422 1333 for more information.
