State and Territory Payroll Tax Obligations

Payroll tax is a tax on the wages paid by employers. Employers are likely for payroll tax when their total Australian wages exceed a certain level called the ‘exemption threshold’. Exemption thresholds vary between states and territories.

The payroll tax obligations for not-for-profit organizations are the same as for businesses, except in certain situation.

Payroll tax should not be confused with the pay as you go (PAYG) withholding structure. Payroll tax is payable to the related state or territory by an employer, based on the total wages paid to all employees. Wages include salary, allowances, super contributions, fringe benefits, shares and options and certain contractor payments.

Some organizations may be exempt from payroll tax provided specific circumstances are satisfied. These organizations may include religious institutions, public benevolent institutions, public or not-for-profit hospitals, not-for-profit non-government schools and charitable organizations.

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