All Payroll Tax Rates and Thresholds Collated [2021 Updated]

Author Image Written by Ben Davies

Everything you need to know about payroll tax

As payroll tax is a state tax, each state or territory has different rates and thresholds for payroll tax. Certain states have weekly, monthly and yearly thresholds so it’s worth checking to ensure that you’re registering for payroll tax where necessary.

Recently, there have been efforts to harmonise payroll tax in Australia for greater administrative consistency for businesses that operate in multiple states and territories.

It’s also important to note that if you are a member of a group of employers, then the threshold is calculated based on the combined annual Australian taxable wages.

Back to top

 

  • Wages, salary, commission, bonuses, allowances or other benefits
  • Superannuation contributions
  • Contractor payments
  • Directors’ fees
  • Payments to employees such as accrued annual leave or cash payouts for termination
  • Value in kind payments
  • Payments to employment agencies
  • Fringe benefits
  • Wages paid to sick or injured staff
  • Employer contributions to employee share schemes
  • Salary sacrifice arrangements
  • Portable long service leave fund contributions
  • Certain allowances and reimbursements to cover expenses

Back to top

  • Paid maternity, adoption or primary carer leave
  • Paid parental leave

Back to top

Tax Year Threshold Rate
1 July 2021to 30 June 2022 $1.2 million 4.85%

Back to top

Tax Year Threshold Rate
1 July 2021 to 30 June 2022 - Metro $650,000 4.85%
1 July 2021 to 30 June 2022 - Regional $650,000 2.425%

Back to top

For employers or groups of employers paying more than $6.5 million, the payroll tax rate is 4.95%.

Regional Queensland employers are entitled to a 1% discount on the payroll tax rate until 30 June 2023.

Tax Year Threshold Rate
1 July 2021 to 30 June 2022 Above $1.3 million and less than $6.5 million 4.75%
1 July 2021 to 30 June 2022 More than $6.5 million 4.95%
1 July 2021 to 30 June 2022 - Regional Above $1.3 million and less than $6.5 million 3.75%
1 July 2021 to 30 June 2022 - Regional More than $6.5 million 4.95%

Back to top

For employers or groups of employers exceeding $1.7 million, the rate is 4.95%!

Tax Year Threshold Rate
1 July 2021 to 30 June 2022 $1.5 million - $1.7 million 0% - 4.95% (Variable)
1 July 2021 to 30 June 2022 $1.7 million 4.95%

Back to top

Tax Year Threshold Rate
From 1 July 2020 $1 million - $7.5 million 5.5%
From 1 July 2020 $7.5 million - $100 million 5.5%
From 1 July 2020

$100 million - $1.5 billion

5% for wages up to $100 million

+

6% for wages from $100 million to $1.5 billion

From 1 July 2020 More than $1.5 billion

5% for wages up to $100 million

+

6% for wages from $100 million to $1.5 billion

+

6.5% for wages above $1.5 billion

Back to top

For businesses with total Australian taxable wages above $2 million, the rate is 6.1%.

Tax Year Threshold Rate
1 July 2020 - 31 June 2021 $1.25 million - $2 million 4%
1 July 2020 - 31 June 2021 $2 million and above 6.1%
Back to top
Tax Year Threshold Rate
From 1 July 2016 to current $2 million 6.85%

Back to top

Tax Year Threshold Rate
1 July 2019 - 30 June 2020 $1.5 million 5.5%

Back to top

We recommend you refer to your relevant state revenue office website for more information:

New South Wales

Victoria

Queensland

South Australia

Western Australia

Tasmania

Australian Capital Territory

Northern Territory

Back to top

 

Employers that operate in multiple states and/or territories must ensure that they conduct the right due diligence on their total taxable Australian wages to avoid neglecting for payroll tax. 

Failure to register and pay payroll tax usually result in financial penalties and interest.

Businesses that deploy cloud payroll as a solution to track and measure their payroll tax ultimately have little problems with payroll tax and are made aware of their obligations as soon as their business (or group of businesses) reaches the threshold. 

To find out how Pay Cat can help you with transitioning to a suitable cloud payroll solution, get in touch with us today.

Contact Us