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JobKeeper payment payroll tax relief announced
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JobKeeper payment payroll tax relief announced

The Victorian Government has announced payroll tax relief for employers who receive the Federal Government’s $1,500 per fortnight JobKeeper payment.

The Victorian Government has announced payroll tax relief for employers who receive the Federal Government’s $1,500 per fortnight JobKeeper payment.

Under the Victorian measures, any top-up payments – that is, additional payments to employees earning less than $1,500 per fortnight that bridge the gap between their actual wage or salary and the scheme’s minimum payment of $1,500 per fortnight – will be exempt from payroll tax.

Example:
An employee normally earns $1,300 per fortnight (pre-tax). Under the JobKeeper scheme the employee is eligible to receive a $1,500 per fortnight. Victoria’s newly announced payroll tax exemption means that, while the $1,300 payment will be subject to payroll tax, the additional $200 top-up from the employer will be exempt.

However, for employees who earn more than $1,500 per fortnight, the full wage or salary will be subject to payroll tax.

For employees who have been stood down, the full $1,500 JobKeeper payment will be exempt from payroll tax.

The Victorian Government’s announcement follows payroll tax measures announced by Western Australia, South Australia, Tasmania and the Australian Capital Territory in relation to the JobKeeper scheme. However, unlike the Victorian exemption, in each of those jurisdictions, the full $1,500 JobKeeper payments will be exempt from payroll tax regardless of the employee’s actual earnings in the fortnight.

Details of the jurisdiction-specific payroll tax exemptions from JobKeeper payments of can be found below.

  • Victoria
  • South Australia
  • Western Australia
  • Tasmania
  • Australian Capital Territory: The ACT has provided no further details other than an undertaking from the Treasurer.
  • Other states and territories: To date, no announcements have been made by New South Wales, Queensland or the Northern Territory, however, announcements are understood to be imminent.

The JobKeeper exemptions from payroll tax are in addition to other COVID-19 related state tax relief measures announced by the various jurisdictions including waivers and deferrals of payroll tax. Details of these can be found here.

Pitcher Partners will keep you apprised and informed of developments as they arise. In the meantime, should you have any queries or concerns, please contact your Pitcher Partners representative.

This content is general commentary only and does not constitute advice. Before making any decision or taking any action in relation to the content, you should consult your professional advisor. To the maximum extent permitted by law, neither Pitcher Partners or its affiliated entities, nor any of our employees will be liable for any loss, damage, liability or claim whatsoever suffered or incurred arising directly or indirectly out of the use or reliance on the material contained in this content. Pitcher Partners is an association of independent firms. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. Liability limited by a scheme approved under professional standards legislation.
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