Budget 2008-09: Payroll Tax Changes

10.06.08

In relation to wages paid or payable on or after 1 July 2008:  

An increase in the pay-roll tax threshold from $504,000 to $552,000.
(The pay-roll tax rate will also be reduced to 5% for wages paid or payable on or after 1 July 2008 which was a measure announced in the 2007-2008 budget and which has already been passed by Parliament).

In relation to wages paid or payable on or after 1 July 2009:

A further increase in the pay-roll tax threshold to $600,000; and
a reduction in the pay-roll tax rate from 5.00 per cent to 4.95 per cent.
The legislation required to implement the pay-roll tax initiatives may not be passed by Parliament prior to 1 July 2008.

RevenueSA will accept pay-roll tax returns which calculate the relevant deduction entitlement based on the increased threshold of $552,000 in relation to wages paid or payable on or after 1 July 2008.  In the event that the legislation is not passed by Parliament, any underpayment of pay-roll tax will be adjusted as part of the Annual Reconciliation process.

Taxpayers who do not wish to avail themselves of this option may continue to calculate their deduction entitlement based on the existing pay-roll tax threshold. Following the passing of the legislation by Parliament any overpayment of pay-roll tax will be adjusted as part of the Annual Reconciliation process.