Pay-roll Tax - Frequently Asked Questions
Pay-roll tax is a general revenue tax assessed on the wages paid by an employer in Western Australia.
The tax is self-assessed. The employer calculates the liability and then pays the appropriate amount to the Office of State Revenue, usually by way of a monthly return.
Pay-roll tax is paid into the Consolidated Fund of the State to meet the costs of public services such as education, health, public safety and law and order.
Pay-roll tax is payable to the State by an employer based on the total wages paid to all employees. Group tax is the income tax deducted from an individual’s income and forwarded to the Australian Taxation Office.
As an employer, when the total Australia-wide wages paid by your business exceed $62,500 per month or $750,000 annually. You are liable to pay-roll tax on wages paid or payable in Western Australia.
Under the pay-roll tax scheme, the effect of grouping is that the wages of all business in a group are combined to determine:
- if a liability to register exists
- the threshold amount.
Tax is paid by each individual group member on the wages paid in its own right.
All members of a group are jointly and severally liable for any pay-roll tax debts due of another group member.
A member of a group is nominated as the designated group employer (DGE) for the purposes of claiming any threshold amount.
The Commissioner has a discretionary power to exclude a business from a group. The grounds for exclusion vary according to the provisions under which the business constitute a group.
For further information please refer to the Grouping Provisions Fact Sheet.
An initial Application for Registration as an Employer should be lodged online. Once the Office of State Revenue has processed your application you will be advised of the outcome.
You will be registered on either a monthly, quarterly or an annual frequency depending on your estimated liability.
For further information please refer to the General Information Fact Sheet.
All payments to workers including wages, salaries, leave entitlements, commissions, bonuses, allowances, directors fees, employee fringe benefits and superannuation contributions are wages subject to pay-roll tax.
For further information please refer to the Wages Definition brochure.
Payments to contract workers will be taxable if an employee/employer relationship exists between the employer and the worker. Further information on how the Office of State Revenue regards contract workers can be obtained from Revenue Ruling PT6.
Should a business operator be uncertain as to their liability for pay-roll tax, professional advice should be sought or the Office of State Revenue contacted for further information.
A questionnaire has been developed to assist employers when seeking professional advice about their contractor payments.
Rate of pay-roll tax
MONTHLY WAGES ($)
|
ANNUAL WAGES ($)
|
TAX RATES (%)
|
0 - 62,500
|
0 - 750,000
|
NIL
|
Over 62,500
|
Over 750,000
|
5.50
|
Monthly returns are due and payable by the 7th of the following month in which the taxable wages were paid or payable, whichever occurs first. The June return is due and payable on 21 July.
Quarterly returns are due and payable by 7th October, January and April and 21 July.
Annual returns and due and payable on 21 July.
Revenue Online allows for payment to be made via Bpay, Customer Initiated Payment Account (CIPA) and Electronic Funds Transfer (EFT).
We have a general information fact sheet which briefly describes the pay-roll tax scheme. We also provide fact sheets on wages definition, grouping provisions, fringe benefits and superannuation and how to calculate your pay-roll tax liability. View our Forms and Publications