Payroll Tax WA
Payroll tax is a significant cost of employing staff for small and medium-sized businesses in Perth and WA. And while there is a payroll tax exemption for small employers is present: the exemption is actually quite small (it is suited moreso for the mirco sized business under $2m). So many small and medium sized business suffer payroll tax and the tax structure (sadly) has not yet considered payroll tax planning.
At Westcourt, we understand that payroll tax can be complex – especially with national businesses as each state has different payroll tax law and administration. And the apportionment of the small business employer threshold (where relevant) can be complicated for national businesses with employees who travel significantly for extended periods.
And we understand that payroll tax audits form the most common and often the most aggressive types of audits. Many of our new clients approaching us have had a negative
Often a family in business will operate separate and distinct businesses whose operations are unrelated to each other – so that these distinct business may well be able to enjoy their own tax threshold even though the one extended family might control both. So looking at the overall family operations and identifying an opportunity for a payroll tax grouping exclusion.
At Westcourt, our outsourced payroll solutions can quickly and efficiently prepare payroll tax forms and lodge them on time – either in WA, Victoria or elsewhere in the country. We do that through Xero payroll for smaller employers and then Key Pay for employees with complex payroll and HR needs.
As part of the payroll solution, it is essential to note that salary and wages paid to a family member can attract payroll tax, and with payroll tax in WA at 5.5%, the question for a family is – what is the benefit of that family member being paid a salary? Sometimes there is still a commercial benefit (notwithstanding the payroll tax), and sometimes the family member will look at their salary and the business dividends as effectively “all the same”.
Engaging Westcourt for payroll tax advice is an excellent strategy because:
- Housing your payroll services with your tax advice services ensures that you obtain a “Whole of Tax” approach to your business, including STP, SGL, FBT, payroll tax, and PAYG withholding.
- In a family business context, payroll tax strategies are unique and cannot be replicated across other larger business models– so a focussed firm can unlock better value.
- Our deep knowledge of tax on other areas of employee remuneration, including employee share schemes, can generate tax outcomes across all of the taxes – including payroll tax.
- We have templates, payroll tax calculators and checklists for every state of Australia that allows national employers to recompute the payroll tax liability on a group basis.
- Our tax leadership position within the profession guarantees you deep knowledge and strategies on payroll tax management.
- Our GGI Global Alliance Network position gives you locally on the ground knowledge for employees offshore.
Frequently Asked Questions
In Western Australia (WA), payroll tax is a tax imposed on the wages and salaries paid by employers. The following are some of the most common exemptions from payroll tax in WA:
Small business exemptions: Employers with an Australian taxable payroll of less than $1 million are exempt from payroll tax in WA.
Government employers: Government employers, including local councils and state government departments, are exempt from payroll tax in WA.
Non-profit organizations: Non-profit organizations, such as charities and religious institutions, are exempt from payroll tax in WA if they are approved as tax exempt by the Office of State Revenue.
Apprentice and trainee wages: Apprentice and trainee wages are exempt from payroll tax in WA.
Payments to contractors: Payments made to contractors for services are exempt from payroll tax in WA if the contractors are registered for Goods and Services Tax (GST) and are not employees.
It’s important to understand that the rules and regulations surrounding payroll tax exemptions can be complex, and it’s a good idea to seek advice from a tax professional if you need help with your payroll tax obligations. A tax professional can help you understand your payroll tax obligations and ensure that you comply with the relevant payroll tax rules and regulations.
In Western Australia (WA), payroll tax is a tax imposed on the wages and salaries paid by employers. The employer is responsible for paying payroll tax on the wages and salaries paid to employees.
Payroll tax is calculated as a percentage of the taxable payroll, which is the total amount of wages and salaries paid by the employer, minus any exemptions and reductions. The payroll tax rate in WA for the 2022-2023 financial year is 5.5%.
It’s important to understand that the rules and regulations surrounding payroll tax can be complex, and it’s a good idea to seek advice from a tax professional like Westcourt if you need help with your payroll tax obligations. A tax professional can help you understand your payroll tax obligations and ensure that you comply with the relevant payroll tax rules and regulations.
In Western Australia (WA), small businesses that have an Australian taxable payroll of less than $1 million are exempt from payroll tax. If a small business has an Australian taxable payroll that exceeds $1 million, it is required to pay payroll tax on the taxable payroll.
To pay payroll tax, the employer must register with the Office of State Revenue and provide information about the taxable payroll, including the amount of wages and salaries paid to employees and any exemptions or reductions.
The payroll tax is calculated as a percentage of the taxable payroll, which is the total amount of wages and salaries paid by the employer, minus any exemptions and reductions. The payroll tax rate in WA for the 2022-2023 financial year is 5.5%.
Payroll tax is usually payable on a monthly or quarterly basis, and the employer is required to lodge a payroll tax return and make payments to the Office of State Revenue by the due date.
It’s important to understand that the rules and regulations surrounding payroll tax can be complex, and it’s a good idea to seek advice from a tax professional like Westcourt if you need help with your payroll tax obligations. A tax professional can help you understand your payroll tax obligations and ensure that you comply with the relevant payroll tax rules and regulations.
