• About Payroll Tax

     

    What is payroll tax?

    Payroll tax is a general purpose tax assessed on the wages paid by an employer in Western Australia.

    Payroll tax is a self assessed tax meaning that the onus is on you, as an employer, to ensure that any information you provide is correct and that you comply with your tax obligations.

    Employers registered for payroll tax declare wages by way of a monthly, quarterly, or annual return. As part of the return lodgment process, your liability is calculated by the Office of State Revenue and you are required to pay the appropriate amount of tax.  See the Payroll Tax Employer Guide for more information.

    Payroll tax is paid into the Consolidated Fund of Western Australia to meet the costs of public services such as Education, Health, Public Safety, and Law and Order.

    For a detailed overview on payroll tax, please refer to the Payroll Tax Employer Guide or watch the video below.

    PRT Employer Guide

    Payroll Tax Employer Guide

    The Payroll Tax Employer Guide is a comprehensive resource with information on payroll tax in WA, all in one interactive, easy to use document.

    Why not join those making the most of the guide now?

     

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    Payroll tax rate and thresholds

    In Western Australia, the payroll tax rate is 5.5%. From 1 July 2016, the annual threshold is $850,000 and the monthly threshold is $70,833.

    Payroll Tax Rate (effective 1 July 2016)
    Monthly Wages ($) Annual Wages ($) Tax Rates (%)
    $0 – $70,833 $0 - $850,000 Nil
    Over $70,833 Over $850,000 5.5
    Payroll Tax Rate (1 July 2014 - 30 June 2016)
    Monthly Wages ($) Annual Wages ($) Tax Rates (%)
    $0 – $66,667 $0 - $800,000 Nil
    Over $66,667 Over $800,000 5.5
    Payroll Tax Rate (up to 30 June 2014)
    Monthly Wages ($) Annual Wages ($) Tax Rates (%)
    $0 – $62,500 $0 - $750,000 Nil
    Over $62,500 Over $750,000 5.5

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    Do I have to register for payroll tax?

    As an employer, you will have to register for payroll tax if the total Australian taxable wages paid by you or your group exceed the monthly or annual threshold amount.

     

    How do I register for payroll tax?

    You can register for payroll tax electronically via our Revenue Online.

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    Payroll Tax (Indigenous Wages) Rebate

    The Payroll Tax (Indigenous Wages) Rebate is paid to employers, or grouped employers, with annual Australian taxable wages of up to $15 million, for Western Australian wages paid in the first two years of employment to new indigenous employees for whom they also receive a Commonwealth Indigenous Wages Subsidy.

    Employers should continue to lodge and pay their payroll tax returns as required. Full records of wages paid to new indigenous workers, including source documents verifying eligibility, must be maintained so employers can provide details of wages paid to new indigenous employees during the payroll tax annual reconciliation process. The rebate will be paid after the reconciliation process is completed, which is expected to be in September each year.

    To apply for a rebate please complete form FPRT5 'Declaration: Indigenous Wages'. The completed form should then be submitted as an attachment to a web enquiry - select the ‘Indigenous Wages Declaration’ sub-category.

    To qualify for this rebate, both the employer and the indigenous employee to whom the wages are paid must be eligible.

    Eligible Employer

    An employer is an eligible employer for an assessment year if they:

    • were registered during whole or part of the year. Unregistered employers liable for payroll tax must apply for registration as an employer by no later than 7 July following the close of the financial year in which the indigenous wages were paid;
    • employed an eligible employee for whole or part of the year;
    • meet the threshold requirements in subsection 7(2) of the Pay-roll Tax (Indigenous Wages) Rebate Act 2012; and
    • submit all returns and information, including Australian taxable wage details if applicable, required to perform the annual reconciliation by no later than 31 December following the end of the assessment year.

    Eligible Employee

    An employee is an eligible employee for an assessment year if the employer receives or received an indigenous wages subsidy in respect of the new employee.

    An employee is a new employee where they:

    • commenced employment with the employer on or after 1 July 2012; and
    • were not employed by that employer, or any other employer in a group of which the employer is a member, at any time before they commenced their employment with that employer.

    Payroll tax, paid in relation to the wages paid to the new employee during the 24 months commencing on the day on which the employee first commenced employment with the employer, may be eligible for the rebate.

    Please note: Eligibility requirements and related deadlines cannot be waived or extended.

    For more information and complete details about the indigenous wages rebate, please see the Pay-roll Tax (Indigenous Wages) Rebate Act 2012 and associated Regulations.

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