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This is a Bill, not an Act. For current law, see the Acts databases.
PARLIAMENT OF VICTORIA
Payroll Tax Bill 2007
TABLE OF PROVISIONS
Clause Page
PART 1--PRELIMINARY 1
1 Purposes 1
2 Commencement 2
3 Definitions 2
4 Taxation Administration Act 1997 5
5 Act binds the Crown 6
PART 2--IMPOSITION OF PAYROLL TAX 7
Division 1--Imposition of tax 7
6 Imposition of payroll tax 7
7 Who is liable for payroll tax? 7
8 Amount of payroll tax 7
9 When must payroll tax be paid? 7
Division 2--Taxable wages 8
10 What are taxable wages? 8
11 Wages not referable to services performed in a particular
month 10
Division 3--Other 10
12 Payroll tax paid under corresponding applied law 10
PART 3--WAGES 12
Division 1--General concept of wages 12
13 What are wages? 12
Division 2--Fringe benefits 13
14 Wages include fringe benefits 13
15 Value of wages comprising fringe benefits 13
16 Employer election regarding taxable value of fringe benefits 14
Division 3--Superannuation contributions 16
17 Wages include superannuation contributions 16
561136B.I-22/5/2007 i BILL LA INTRODUCTION 22/5/2007
Clause Page
Division 4--Shares and options 17
18 Inclusion of grant of shares and options as wages 17
19 Choice of relevant day 18
20 Deemed choice of relevant day in special cases 19
21 Effect of rescission, cancellation of share or option 19
22 Grant of share pursuant to exercise of option 20
23 Value of shares and options 20
24 Inclusion of shares and options granted to directors as wages 21
25 When services considered to have been performed 22
26 Place where wages are payable 23
Division 5--Termination payments 23
27 Definitions 23
28 Termination payments 25
Division 6--Allowances 25
29 Motor vehicle allowances 25
30 Accommodation allowances 27
Division 7--Contractor provisions 28
31 Definitions 28
32 What is a relevant contract? 28
33 Persons taken to be employers 32
34 Persons taken to be employees 32
35 Amounts under relevant contracts taken to be wages 33
36 Liability provisions 34
Division 8--Employment agents 34
37 Definitions 34
38 Persons taken to be employers 35
39 Persons taken to be employees 35
40 Amounts taken to be wages 35
41 Liability provisions 36
42 Agreement to reduce or avoid liability to payroll tax 36
Division 9--Other 37
43 Value of wages paid in kind 37
44 GST excluded from wages 37
45 Wages paid by group employers 38
46 Wages paid by or to third parties 38
47 Agreement etc. to reduce or avoid liability to payroll tax 40
561136B.I-22/5/2007 ii BILL LA INTRODUCTION 22/5/2007
Clause Page
PART 4--EXEMPTIONS 41
Division 1--Non-profit organisations 41
48 Non-profit organisations 41
Division 2--Education and training 42
49 Schools and educational services and training 42
50 Community Development Employment Project 42
Division 3--Health care service providers 43
51 Health care service providers 43
52 Division not to limit other exemptions 43
Division 4--Maternity and adoption leave 43
53 Maternity and adoption leave 43
54 Administrative requirements for exemption 44
Division 5--Volunteer firefighters and emergency service
volunteers 45
55 Volunteer firefighters 45
56 Emergency service volunteers 45
57 Limitation of exemption 46
Division 6--Local government 46
58 Municipal councils 46
59 Local government business entities 46
60 Limitation on local government exemptions 47
Division 7--Other government and defence 47
61 State Governors 47
62 Defence personnel 48
63 War Graves Commission 48
Division 8--Foreign government representatives and international
agencies 48
64 Consular and non-diplomatic representatives 48
65 Trade commissioners 48
66 Australian-American Fulbright Commission 48
PART 5--GROUPING OF EMPLOYERS 49
Division 1--Interpretation 49
67 Definitions 49
68 Grouping provisions to operate independently 49
561136B.I-22/5/2007 iii BILL LA INTRODUCTION 22/5/2007
Clause Page
Division 2--Business groups 50
69 Constitution of groups 50
70 Groups of corporations 50
71 Groups arising from the use of common employees 50
72 Groups of commonly controlled businesses 51
73 Groups arising from tracing of interests in corporations 55
74 Smaller groups subsumed by larger groups 58
Division 3--Business groups--tracing of interests in corporations 58
75 Application 58
76 Direct interest 59
77 Indirect interest 60
78 Aggregation of interests 62
Division 4--Miscellaneous 63
79 Exclusion of persons from groups 63
80 Designated group employers 64
81 Joint and several liability 66
PART 6--ADJUSTMENTS OF TAX 67
82 Determination of correct amount of payroll tax 67
83 Annual adjustment of payroll tax 67
84 Adjustment of payroll tax when employer changes
circumstances 68
85 Special provision where wages fluctuate 70
PART 7--REGISTRATION AND RETURNS 72
86 Registration 72
87 Returns 73
PART 8--COLLECTION AND RECOVERY OF TAX 74
Division 1--Agents and trustees generally 74
88 Application 74
89 Agents and trustees are answerable 74
90 Returns by agent or trustee 74
91 Liability to pay tax 75
92 Indemnity for agent or trustee 75
Division 2--Special cases 76
93 Tax not paid during lifetime 76
94 Payment of tax by executors or administrators 76
95 Assessment if no probate within 6 months of death 77
96 Person in receipt or control of money for absentee 77
561136B.I-22/5/2007 iv BILL LA INTRODUCTION 22/5/2007
Clause Page
97 Agent for absentee principal winding-up business 79
98 Recovery of tax paid on behalf of another person 79
99 Liquidator to give notice 80
PART 9--GENERAL 82
100 Provisions specific to this jurisdiction 82
101 Regulations 82
PART 10--REPEALS, AMENDMENTS AND TRANSITIONAL
PROVISIONS 84
Division 1--Pay-roll Tax Act 1971 84
102 Repeal of Pay-roll Tax Act 1971 84
103 Repeal of amending Act 84
Division 2--Taxation Administration Act 1997 85
104 Taxation laws 85
105 Reassessments and refunds up to 5 years 85
106 Objections 85
107 New clause 16 inserted in Schedule 1 86
16 Reassessment and refund periods extended to 5 years 86
Division 3--Amendment of this Act 87
108 Education and training 87
Division 4--Other Acts 88
109 County Court Act 1958 88
110 Duties Act 2000 89
111 New clause 26 inserted in Schedule 2 to the Duties Act 2000 89
26 Payroll Tax Act 2007 89
112 Land Tax Act 2005 89
113 Local Government Act 1989 89
114 Magistrates' Court Act 1989 90
115 Taxation (Reciprocal Powers) Act 1987 90
116 Victorian Civil and Administrative Tribunal Act 1998 90
Division 5--Transitional provisions 91
117 Transitional provisions 91
__________________
561136B.I-22/5/2007 v BILL LA INTRODUCTION 22/5/2007
Clause Page
SCHEDULES 92
SCHEDULE 1--Calculation of Payroll Tax Liability 92
PART 1--INTERPRETATION 92
1 Definitions 92
PART 2--EMPLOYERS WHO ARE NOT MEMBERS OF A
GROUP 93
2 Application of Part 93
3 Definitions 93
4 Payroll of employer under threshold 93
5 Payroll of employer over threshold 94
PART 3--GROUPS WITH A DESIGNATED GROUP
EMPLOYER 95
6 Application of Part 95
7 Definitions 95
8 Payroll of group under threshold 95
9 Payroll of group over threshold 96
PART 4--GROUPS WITH NO DESIGNATED GROUP
EMPLOYER 97
10 Application of Part 97
11 Definition 97
12 Calculation of payroll tax 97
PART 5--MOTOR VEHICLE ALLOWANCES 98
13 Continuous recording method 98
14 Averaging method 98
15 Meaning of relevant 12-week period 101
16 Replacing one motor vehicle with another motor vehicle 102
17 Changing method of recording 102
18 Definition 103
SCHEDULE 2--Victoria specific provisions 104
PART 1--INTRODUCTION 104
1 Introduction to Schedule 104
PART 2--CALCULATION OF MONTHLY PAYROLL TAX 105
Division 1--Rate of payroll tax 105
2 Rate of payroll tax 105
Division 2--Employers who are not members of a group 105
3 Application of Division 105
561136B.I-22/5/2007 vi BILL LA INTRODUCTION 22/5/2007
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4 Amount of payroll tax to be paid each month 105
5 Deductible amount for employer who does not pay interstate
wages 106
6 Deductible amount for employer who pays interstate wages 106
Division 3--Groups with a designated group employer 107
7 Application of Division 107
8 Amount of payroll tax to be paid each month 108
9 Deductible amount for groups that do not pay interstate wages 110
10 Deductible amount for groups that pay interstate wages 110
Division 4--Groups with no designated group employer 111
11 Application of Division 111
12 Amount of payroll tax to be paid each month 112
PART 3--EXEMPTIONS 113
Division 1--Education and training 113
13 Definitions 113
14 Schools and school councils 113
15 Persons providing educational services 114
16 Approved training schemes 114
Division 2--Health care service providers 114
17 What is a health care service provider? 114
Division 3--Local government 116
18 Limitation on local government exemptions 116
Division 4--Other exemptions 116
19 Specialized agencies 116
PART 4--RETURNS AND REFUNDS 117
20 Further returns 117
21 Notification of change in circumstances 117
22 Time limit for refund applications 118
PART 5--GENERAL 119
23 Disregarding cents 119
SCHEDULE 3--Transitional provisions 120
1 Definition 120
2 Savings and transitional regulations 120
3 Application of Interpretation of Legislation Act 1984 121
4 Continuation of old Act and regulations 121
5 Application of this Act and old Act 121
561136B.I-22/5/2007 vii BILL LA INTRODUCTION 22/5/2007
Clause Page
6 Fringe benefits 122
7 Superannuation contributions relating to pre-1 July 1997
service 123
8 Superannuation contributions not readily related to particular
employees 124
9 Employment agents 125
10 Exemption continues for certain schools 125
11 Approved training schemes 126
12 Exemption continues for public hospitals 126
13 Registration of employers 126
14 Designated group employers 126
ENDNOTES 127
561136B.I-22/5/2007 viii BILL LA INTRODUCTION 22/5/2007
PARLIAMENT OF VICTORIA
Introduced in the Assembly
Payroll Tax Bill 2007
A Bill for an Act to re-enact and modernise the law relating to payroll
tax, to harmonise payroll tax law with New South Wales, to repeal the
Pay-roll Tax Act 1971, to amend the Taxation Administration Act
1997 and other Acts and for other purposes.
The Parliament of Victoria enacts:
PART 1--PRELIMINARY
1 Purposes
The purposes of this Act are--
(a) to re-enact and modernise the law relating to
5 payroll tax; and
(b) to harmonise payroll tax law with New South
Wales; and
(c) to repeal the Pay-roll Tax Act 1971; and
561136B.I-22/5/2007 1 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 1--Preliminary
s. 2
(d) to amend the Taxation Administration Act
1997 and other Acts.
2 Commencement
(1) This Act (except section 108) comes into
5 operation on 1 July 2007.
(2) Section 108 comes into operation on the later of--
(a) 1 July 2007;
(b) the day on which section 6.1.2 of the
Education and Training Reform Act 2006
10 comes into operation.
3 Definitions
In this Act--
agent includes--
(a) a person who, in this jurisdiction, for or
15 on behalf of another person outside this
jurisdiction, holds or has the
management or control of the business
of that other person; and
(b) a person who, by an order of the
20 Commissioner, is declared to be an
agent or the sole agent for any other
person for the purposes of this Act and
on whom notice of that order has been
served;
25 Australia means the States of the Commonwealth
and the Territories;
coastal waters of Victoria has the same meaning
as coastal waters of the State has in relation
to Victoria in the Coastal Waters (State
30 Powers) Act 1980 of the Commonwealth;
company includes all bodies and associations
(corporate and unincorporate) and
partnerships;
561136B.I-22/5/2007 2 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 1--Preliminary
s. 3
corporation has the same meaning as in section 9
of the Corporations Act;
corresponding law means a law in force in
another State or a Territory relating to the
5 imposition upon employers of a tax on wages
paid or payable by them and the assessment
and collection of that tax;
designated group employer means a member
designated for a group in accordance with
10 section 80;
director of a company includes a member of the
governing body of the company;
employer means a person who pays or is liable to
pay wages and includes--
15 (a) the Crown in any of its capacities; and
(b) a person taken to be an employer by or
under this Act; and
(c) a public, local or municipal body or
authority constituted under the law of
20 the Commonwealth or of a State or
Territory unless, being an authority
constituted under the law of the
Commonwealth, it is immune from the
operation of this Act;
25 employment agency contract has the meaning
given in section 37;
employment agent has the meaning given in
section 37;
exempt wages mean wages that are declared by or
30 under this Act to be exempt wages;
FBTA Act means the Fringe Benefits Tax
Assessment Act 1986 of the Commonwealth;
financial year means each year commencing on
1 July;
561136B.I-22/5/2007 3 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 1--Preliminary
s. 3
fringe benefit has the same meaning as in the
FBTA Act but does not include--
(a) a tax-exempt body entertainment fringe
benefit within the meaning of that Act;
5 or
(b) anything that is prescribed by the
regulations under this Act not to be a
fringe benefit for the purposes of this
definition;
10 group has the meaning given in section 67;
GST has the same meaning as it has in the A New
Tax System (Goods and Services Tax) Act
1999 of the Commonwealth except that it
includes notional GST of the kind for which
15 payments may be made under Part 3 of the
National Taxation Reform (Consequential
Provisions) Act 2000 by a person that is a
State entity within the meaning of that Act;
interstate wages means wages that are taxable
20 wages within the meaning of a
corresponding law;
ITAA means the Income Tax Assessment Act
1997 of the Commonwealth;
liquidator means the person who, whether or not
25 appointed as liquidator, is the person
required by law to carry out the winding-up
of a company;
month means the month of January, February,
March, April, May, June, July, August,
30 September, October, November and
December;
option means an option or right, whether actual,
prospective or contingent, of a person to
acquire a share or to have a share transferred
35 or allotted to the person;
561136B.I-22/5/2007 4 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 1--Preliminary
s. 4
paid, in relation to wages, includes provided,
conferred and assigned and pay and payable
have corresponding meanings;
payroll tax means tax imposed by section 6;
5 perform, in relation to services, includes render;
return period, in relation to an employer, means a
period relating to which that employer is
required to lodge a return under this Act;
share means a share in a company and includes a
10 stapled security within the meaning of
section 139GCD of the Income Tax
Assessment Act 1936 of the Commonwealth;
superannuation contribution has the meaning
given in section 17(2);
15 taxable wages has the meaning given in
section 10;
termination payment has the meaning given in
section 27;
Territories means the Australian Capital Territory
20 (including the Jervis Bay Territory) and the
Northern Territory;
this jurisdiction means Victoria and the coastal
waters of Victoria;
voting share has the same meaning as in section 9
25 of the Corporations Act;
wages has the meaning given in Part 3.
4 Taxation Administration Act 1997
This Act is to be read together with the Taxation
Administration Act 1997 which provides for the
30 administration and enforcement of this Act and
other taxation laws.
561136B.I-22/5/2007 5 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 1--Preliminary
s. 5
5 Act binds the Crown
(1) This Act binds the Crown in right of this
jurisdiction and, so far as the legislative power of
the Parliament permits, the Crown in all its other
5 capacities.
(2) Nothing in this Act makes the Crown in any of its
capacities liable to be prosecuted for an offence.
__________________
561136B.I-22/5/2007 6 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 2--Imposition of Payroll Tax
s. 6
PART 2--IMPOSITION OF PAYROLL TAX
Division 1--Imposition of tax
6 Imposition of payroll tax
Payroll tax is imposed on all taxable wages.
5 7 Who is liable for payroll tax?
The employer by whom taxable wages are paid or
payable is liable to pay payroll tax on the wages.
8 Amount of payroll tax
The amount of payroll tax payable by an employer
10 is to be ascertained in accordance with
Schedules 1 and 2.
9 When must payroll tax be paid?
(1) A person who is liable to pay payroll tax on
taxable wages must pay the tax--
15 (a) within 7 days after the end of the month in
which those wages were paid or payable,
other than the month of June; and
(b) within 21 days after the end of the month of
June in relation to taxable wages paid or
20 payable in the month of June.
(2) However, if the Commissioner has reason to
believe that a person may leave Australia before
any payroll tax becomes payable by the person,
the tax is payable on the day fixed by the
25 Commissioner by notice served on the person.
561136B.I-22/5/2007 7 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 2--Imposition of Payroll Tax
s. 10
Division 2--Taxable wages
10 What are taxable wages?
(1) For the purposes of this Act, taxable wages are
wages, other than exempt wages, that are paid or
5 payable by an employer for services performed
and--
(a) are wages that are paid or payable in this
jurisdiction, other than wages so paid or
payable for--
10 (i) services performed wholly in one other
State or Territory; or
(ii) services performed by a person wholly
in another country for a continuous
period of more than 6 months
15 beginning on the day on which wages
were first paid or payable to that person
for services so performed; or
(b) are wages that are paid or payable outside
this jurisdiction for services performed
20 wholly in this jurisdiction; or
(c) are wages that are paid or payable outside
Australia for services performed mainly in
this jurisdiction.
(2) For the purposes of subsection (1)(a), wages that
25 are payable to a person by the person's employer,
but have not been paid (not being wages that
under the terms of employment are payable in this
jurisdiction or in another State or a Territory) are
taken--
30 (a) if those wages are payable in respect of
services performed wholly in this
jurisdiction--to be wages payable to that
person in this jurisdiction; and
561136B.I-22/5/2007 8 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 2--Imposition of Payroll Tax
s. 10
(b) if those wages are not payable in respect of
services performed wholly in this jurisdiction
or wholly in one other State or Territory and
where the wages last paid or payable to that
5 person by that employer were included or are
required to be included in a return under this
Act--to be wages payable to that person in
this jurisdiction; and
(c) if those wages are not taken by paragraph (a)
10 or (b) or by any provision in a corresponding
law that corresponds to either of those
paragraphs to be wages payable to that
person in this jurisdiction or in another State
or a Territory--to be wages payable to that
15 person by that employer at the place where
that person last performed any services for
that employer before those wages became
payable.
(3) If, for the purpose of the payment of wages--
20 (a) an instrument is sent or given or an amount
is transferred by an employer to a person or a
person's agent at a place in Australia; or
(b) an instruction is given by an employer for
the crediting of an amount to the account of a
25 person or a person's agent at a place in
Australia--
those wages are taken to have been paid at that
place and to have been paid when the instrument
was sent or given, the amount was transferred or
30 the account is credited in accordance with the
instruction (as the case may be).
(4) In determining the question whether services are
performed wholly or mainly in this jurisdiction or
another State or a Territory, regard must be had
35 only to the services performed during the month
in respect of which the question arises.
561136B.I-22/5/2007 9 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 2--Imposition of Payroll Tax
s. 11
(5) In this section--
instrument includes a cheque, bill of exchange,
promissory note, money order or a postal
order issued by a post office.
5 11 Wages not referable to services performed in a
particular month
For the purposes of this Act, wages that are not
paid in respect of services performed by an
employee in a particular month are taxable wages
10 as if they were paid or payable in respect of
services performed during the month in which
they were paid or became payable.
Division 3--Other
12 Payroll tax paid under corresponding applied law
15 (1) For the purposes of ascertaining the payroll tax
payable under this Act by an employer who
during a return period pays taxable wages and
Commonwealth place wages, there is to be
deducted from the amount of payroll tax payable
20 by the employer under this Act the amount of
payroll tax payable by the employer under the
corresponding applied law.
(2) In this section--
Commonwealth Act means the Commonwealth
25 Places (Mirror Taxes) Act 1998 of the
Commonwealth;
Commonwealth place wages means wages that
would be taxable wages within the meaning
of the corresponding applied law if the
30 corresponding applied law applied in relation
to each place in this jurisdiction that is a
Commonwealth place;
561136B.I-22/5/2007 10 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 2--Imposition of Payroll Tax
s. 12
corresponding applied law means the provisions
of the Payroll Tax Act 2007 that would
apply in relation to each place in this
jurisdiction that is a Commonwealth place,
5 pursuant to section 6(2) of the
Commonwealth Act, if those provisions were
excluded provisions within the meaning of
section 6(1) of the Commonwealth Act.
__________________
561136B.I-22/5/2007 11 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 13
PART 3--WAGES
Division 1--General concept of wages
13 What are wages?
(1) For the purposes of this Act, wages mean wages,
5 remuneration, salary, commission, bonuses or
allowances paid or payable to an employee,
including--
(a) an amount paid or payable by way of
remuneration to a person holding an office
10 under the Crown or in the service of the
Crown; and
(b) an amount paid or payable under any
prescribed classes of contracts to the extent
to which that payment is attributable to
15 labour; and
(c) an amount paid or payable by a company by
way of remuneration to or in relation to a
director of that company; and
(d) an amount paid or payable by way of
20 commission to an insurance or time-payment
canvasser or collector; and
(e) an amount that is included as or taken to be
wages by any other provision of this Act.
(2) For the purposes of this Act, wages, remuneration,
25 salary, commission, bonuses or allowances are
wages--
(a) whether paid or payable at piece work rates
or otherwise; and
(b) whether paid or payable in cash or in kind.
561136B.I-22/5/2007 12 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 14
Division 2--Fringe benefits
14 Wages include fringe benefits
(1) For the purposes of this Act, wages include a
fringe benefit.
5 (2) Subsection (1) does not apply to benefits that are
exempt benefits for the purposes of the FBTA Act
(other than deposits to the Superannuation
Holding Accounts Special Account within the
meaning of the Small Superannuation Accounts
10 Act 1995 of the Commonwealth).
15 Value of wages comprising fringe benefits
(1) For the purposes of this Act, the value of wages
comprising a fringe benefit is to be determined in
accordance with the formula--
1
15 TV ×
1 - FBT rate
where--
TV is the value that would be the taxable value
of the benefit as a fringe benefit for the
purposes of the FBTA Act;
20 FBT rate is the rate of fringe benefits tax imposed by
the FBTA Act that applies when the liability
to payroll tax under this Act arises.
(2) In this Act, a reference to taxable wages that were
paid or payable by an employer during a month is,
25 in relation to taxable wages comprising fringe
benefits--
(a) a reference to the value of the fringe benefits
paid or payable by the employer during the
month; or
30 (b) if an election by the employer is in force
under section 16, a reference to an amount
calculated in accordance with that section.
561136B.I-22/5/2007 13 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 16
(3) In this Act, a reference to taxable wages that were
paid or payable by an employer during a year is,
in relation to taxable wages comprising fringe
benefits, a reference to an amount calculated by
5 adding together the amounts under
subsection (2)(a) or (b) (or subsection (2)(a)
and (b)) as the case requires, for the months of
that year.
16 Employer election regarding taxable value of fringe
10 benefits
(1) An employer who has paid or is liable to pay
fringe benefits tax imposed by the FBTA Act in
respect of a period of not less than 15 months
before 30 June in any year may elect to include as
15 the value of the fringe benefits paid or payable by
the employer during the month concerned--
(a) in a return lodged in relation to each of the
first 11 months occurring after 30 June in
that year--1/12th of the amount determined in
20 accordance with subsection (2) or that part of
that amount as, in accordance with
section 10, comprises taxable wages for the
year of tax (within the meaning of the FBTA
Act) ending on 31 March preceding the
25 commencement of the current financial year;
and
(b) in the return lodged in relation to the
12th month--the amount determined in
accordance with subsection (2) or that part of
30 that amount as, in accordance with
section 10, comprises taxable wages for the
year of tax (within the meaning of the FBTA
Act) ending on 31 March preceding that
month, less the total of the amounts of fringe
35 benefits included in the returns for each of
the preceding 11 months.
561136B.I-22/5/2007 14 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 16
(2) The amount determined in accordance with this
subsection is to be determined in accordance with
the formula--
1
AFBA ×
1 - FBT rate
5 where--
AFBA is the aggregate fringe benefits amount
within the meaning of section 136 of the
FBTA Act;
FBT rate is the rate of fringe benefits tax imposed by
10 the FBTA Act that applies when the liability
to payroll tax under this Act arises.
(3) An election under subsection (1) takes effect when
it is notified to the Commissioner in the form
approved by the Commissioner.
15 (4) After an employer has made an election under
subsection (1), the employer must lodge returns
containing amounts calculated in accordance with
the election unless the Commissioner approves, by
notice in writing given to the employer, the
20 termination of the election and allows the
employer to include the value referred to in
section 15(2)(a).
(5) If an employer ceases to be liable to pay payroll
tax, the value of taxable wages comprising fringe
25 benefits to be included in the employer's final
return is (irrespective of whether or not the
employer has made an election under
subsection (1)) the value of the fringe benefits
paid or payable by the employer for the period
30 commencing on and including the preceding
1 July until the date on which the employer ceases
to be liable to payroll tax, less the value of the
fringe benefits paid or payable by the employer
561136B.I-22/5/2007 15 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 17
during that period on which payroll tax has been
paid.
Division 3--Superannuation contributions
17 Wages include superannuation contributions
5 (1) For the purposes of this Act, wages include a
superannuation contribution.
(2) A superannuation contribution is a contribution
paid or payable by an employer in respect of an
employee--
10 (a) to or as a superannuation fund within the
meaning of the Superannuation Industry
(Supervision) Act 1993 of the
Commonwealth; or
(b) as a superannuation guarantee charge within
15 the meaning of the Superannuation
Guarantee (Administration) Act 1992 of the
Commonwealth; or
(c) to or as any other form of superannuation,
provident or retirement fund or scheme
20 including--
(i) the Superannuation Holding Accounts
Special Account within the meaning of
the Small Superannuation Accounts Act
1995 of the Commonwealth; and
25 (ii) a retirement savings account within the
meaning of the Retirement Savings
Accounts Act 1997 of the
Commonwealth; and
(iii) a wholly or partly unfunded fund or
30 scheme.
(3) Setting aside any money or anything that is worth
money as, or as part of, a superannuation fund,
superannuation guarantee charge or any other
561136B.I-22/5/2007 16 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 18
form of superannuation, provident or retirement
fund or scheme is taken to be paying a
superannuation contribution.
(4) Making a superannuation contribution of anything
5 that is worth money is taken to be paying a
superannuation contribution of the amount equal
to its value, and its value is to be worked out in
accordance with section 43 as if that section
referred to the contribution instead of to wages.
10 (5) A superannuation, provident or retirement fund or
scheme is unfunded to the extent that money paid
or payable by an employer in respect of an
employee covered by the fund or scheme is not
paid or payable during the employee's period of
15 service with the employer.
(6) In this section--
employee includes any person to whom, by virtue
of a paragraph of the definition of wages in
section 13(1), an amount paid or payable in
20 the circumstances referred to in that
paragraph constitutes wages.
Division 4--Shares and options
18 Inclusion of grant of shares and options as wages
(1) For the purposes of this Act, wages include the
25 grant of a share or option to an employee by an
employer in respect of services performed by the
employee.
(2) Any such wages are taken, for the purpose of the
imposition of payroll tax, to be paid or payable on
30 the relevant day.
(3) For the purposes of this Division, the relevant day
is the day that the employer elects in accordance
with this Division to treat as the day on which the
wages are paid or payable.
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Part 3--Wages
s. 19
(4) To avoid doubt, the grant of a share or option is
valuable consideration for the purposes of
section 46.
19 Choice of relevant day
5 (1) The employer can elect to treat as the relevant day
either the date on which the share or option is
granted to the employee or the vesting date.
(2) A share or option is granted to a person in the
following circumstances--
10 (a) in the case of a share--if the person acquires
the share (within the meaning of
section 139G of the Income Tax Assessment
Act 1936 of the Commonwealth) or in the
circumstances prescribed by the regulations
15 under this Act;
(b) in the case of an option--if the person
acquires a right (within the meaning of
section 139G of the Income Tax Assessment
Act 1936 of the Commonwealth) to the share
20 to which the option relates or in the
circumstances prescribed by the regulations
under this Act.
(3) The vesting date in respect of a share is the date
on which the share vests in the employee (that is,
25 when any conditions applying to the grant of the
share have been met and the employee's legal or
beneficial interest in the share cannot be
rescinded).
(4) The vesting date in respect of an option is one of
30 the following dates (whichever happens first)--
(a) the date on which the share to which the
option relates is granted to the employee;
561136B.I-22/5/2007 18 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 20
(b) the date on which the employee exercises a
right under the option to have the share the
subject of the option transferred to, allotted
to or vest in him or her.
5 20 Deemed choice of relevant day in special cases
(1) If an employer grants a share or an option to an
employee and the value of the grant of the share
or option is not included in the taxable wages of
the employer for the financial year in which the
10 share or option was granted, the employer is taken
to have elected to treat the wages constituted by
the grant of that share or option as being paid or
payable on the vesting date.
(2) If an employer grants a share or an option to an
15 employee and the value of the grant of the share
or option is nil or, if the employer were to elect to
treat the date of grant as the relevant day, the
wages constituted by the grant would not be liable
to payroll tax, the employer is taken to have
20 elected to treat the wages constituted by the grant
of that share or option as being paid or payable on
the date on which the share or option was granted.
21 Effect of rescission, cancellation of share or option
(1) If the grant of a share or option is withdrawn,
25 cancelled or exchanged before the vesting date for
any valuable consideration (other than the grant of
other shares or options), the following provisions
apply--
(a) the date of withdrawal, cancellation or
30 exchange is taken to be the vesting date of
the share or option;
(b) the market value of the share or option, on
the vesting date, is taken to be the amount of
the valuable consideration (and, accordingly,
35 that amount is the amount paid or payable as
wages on that date).
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Payroll Tax Bill 2007
Part 3--Wages
s. 22
(2) If an employer includes the value of a grant of a
share or option in the taxable wages of the
employer for a financial year and the grant is
rescinded because the conditions attaching to the
5 grant were not met, the taxable wages of the
employer, in the financial year in which the grant
is rescinded, are to be reduced by the value of the
grant as previously included in the taxable wages
of the employer.
10 (3) Subsection (2) does not apply just because an
employee fails to exercise an option or to
otherwise exercise his or her rights in respect of a
share or option.
22 Grant of share pursuant to exercise of option
15 The grant of the share by an employer does not
constitute wages for the purposes of this Act if the
employer is required to grant the share as a
consequence of the exercise of an option by a
person and--
20 (a) the grant of the option to the person
constitutes wages for the purposes of this
Act; or
(b) the option was granted to the person before
1 July 2007.
25 23 Value of shares and options
(1) If the grant of a share or option constitutes wages
under this Division, the amount paid or payable as
wages is taken, for the purposes of this Act, to be
the market value of the share or option (expressed
30 in Australian currency) on the relevant day, less
the consideration (if any) paid or given by the
employee in respect of the share or option (other
than consideration in the form of services
performed).
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Payroll Tax Bill 2007
Part 3--Wages
s. 24
(2) The market value of a share or option on the
relevant day is to be determined in accordance
with the Commonwealth income tax provisions.
(3) For that purpose, the Commonwealth income tax
5 provisions apply with the following modifications,
and any other necessary modifications--
(a) the market value of an option is to be
determined as if it were a right to acquire a
share;
10 (b) a reference to a taxpayer is to be read as a
reference to the employee;
(c) a reference to the Commissioner of Taxation
is to be read as a reference to either that
Commissioner or the Commissioner of State
15 Revenue.
(4) Section 15 does not apply to the grant of a share
or option that constitutes wages, even if it
constitutes a fringe benefit.
(5) In this section--
20 Commonwealth income tax provisions means the
provisions of Subdivision F of Division 13A
of Part III of the Income Tax Assessment
Act 1936 of the Commonwealth.
24 Inclusion of shares and options granted to directors
25 as wages
(1) For the purposes of this Act, wages include the
grant of a share, or option, by a company to a
director of the company by way of remuneration
for the appointment or services of the director that
30 would be wages under this Division if the director
were an employee of the company.
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Part 3--Wages
s. 25
(2) For that purpose, the other provisions of this
Division apply in respect of any such grant as if a
reference to the employer were a reference to the
company and a reference to the employee were a
5 reference to the director of the company.
(3) In this section, a reference to a director of the
company includes a reference to the following--
(a) a person who, under a contract or other
arrangement, is to be appointed as a director
10 of the company;
(b) a former director of the company.
(4) In the case of wages constituted by the grant of a
share or option by a company to a director of the
company by way of remuneration for the
15 appointment of the director, but not for services
performed--
(a) the grant of the share or option is taken, for
the purposes of this Act, to be paid or
payable for services performed during the
20 month in which the relevant day occurs; and
(b) a reference in this Act to the place or places
where services are performed is a reference
to the place or places where it may
reasonably be expected that the services of
25 the director in respect of the company will be
performed.
25 When services considered to have been performed
For the purposes of this Act, if the grant of a share
or an option constitutes wages for the purposes of
30 this Act, the services in respect of which those
wages are paid or payable are taken to have been
performed during the month in which the relevant
day occurs.
561136B.I-22/5/2007 22 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 26
26 Place where wages are payable
(1) The wages constituted by the grant of the share or
option are taken to be paid or payable in this
jurisdiction if the share is a share in a local
5 company or, in the case of an option, an option to
acquire shares in a local company.
(2) In any other case, the wages constituted by the
grant of the share or option are taken to be paid or
payable outside this jurisdiction.
10 Note
If the wages concerned are taken to be payable outside this
jurisdiction, because the shares concerned are shares in a
company that is not a local company, the grant of the share
or option may still be liable to payroll tax under this Act if
15 the grant is made for services performed or rendered wholly
or mainly in this jurisdiction (see section 10(1)(b) and (c)).
(3) In this section--
local company means--
(a) a company incorporated or taken to be
20 incorporated under the Corporations
Act that is taken to be registered in this
jurisdiction for the purposes of that Act;
or
(b) any other body corporate that is
25 incorporated under an Act of this
jurisdiction.
Division 5--Termination payments
27 Definitions
In this Division--
30 employment termination payment means--
(a) an employment termination payment
within the meaning of section 82-130 of
the ITAA; or
561136B.I-22/5/2007 23 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 27
(b) a payment that would be an
employment termination payment
within the meaning of section 82-130 of
the ITAA but for the fact that it was
5 received later than 12 months after the
termination of a person's employment;
or
(c) a transitional termination payment
within the meaning of section 82-10 of
10 the Income Tax (Transitional
Provisions) Act 1997 of the
Commonwealth;
termination payment means--
(a) a payment made in consequence of the
15 retirement from, or termination of, any
office or employment of an employee,
being--
(i) an unused annual leave payment;
or
20 (ii) an unused long service leave
payment; or
(iii) so much of an employment
termination payment paid or
payable by an employer, whether
25 or not paid to the employee or to
any other person or body, that
would be included in the
assessable income of an employee
under Part 2-40 of the ITAA if the
30 whole of the employment
termination payment had been
paid to the employee; or
(b) an amount paid or payable by a
company as a consequence of the
35 termination of the services or office of
a director of the company, whether or
561136B.I-22/5/2007 24 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 28
not paid to the director or to any other
person or body, that would be an
employment termination payment if
that amount had been paid or payable
5 as a consequence of termination of
employment; or
(c) an amount paid or payable by a person
who is an employer under a relevant
contract (within the meaning of
10 section 32) as a consequence of the
termination of the supply of the
services of an employee under the
contract, whether or not paid to the
employee or to any other person, if the
15 amount would be an employment
termination payment if that amount had
been paid or payable as a consequence
of termination of employment;
unused annual leave payment has the same
20 meaning as in section 83-10 of the ITAA;
unused long service leave payment has the same
meaning as in section 83-75 of the ITAA.
28 Termination payments
For the purposes of this Act, wages include a
25 termination payment.
Division 6--Allowances
29 Motor vehicle allowances
(1) For the purposes of this Act, wages, in respect of a
financial year, do not include the exempt
30 component of a motor vehicle allowance paid or
payable in respect of that year.
(2) Accordingly, if the total motor vehicle allowance
paid or payable to an employee in respect of a
financial year does not exceed the exempt
561136B.I-22/5/2007 25 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 29
component, the motor vehicle allowance is not
wages for the purposes of this Act.
(3) If the total motor vehicle allowance paid or
payable to an employee in respect of a financial
5 year exceeds the exempt component (if any), only
that amount that exceeds the exempt component
of the motor vehicle allowance is included as
wages for the purposes of this Act.
(4) The exempt component of a motor vehicle
10 allowance paid or payable in respect of a financial
year is calculated in accordance with the
formula--
E=K×R
where--
15 E is the exempt component;
K is the number of business kilometres
travelled during the financial year;
R is the exempt rate.
(5) The number of business kilometres travelled
20 during the financial year ("K") is to be
determined in accordance with the continuous
recording method, or the averaging method,
whichever method is selected and used by the
employer in accordance with Part 5 of Schedule 1.
25 (6) The Commissioner, by order in writing, may
approve the use, by an employer or class of
employer, of another method of determining the
number of business kilometres travelled during
the financial year (including the use of an
30 estimate). If so, the number of business
kilometres travelled during the financial year is to
be determined in accordance with the method
approved by the Commissioner.
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Part 3--Wages
s. 30
(7) For the purposes of this section, the exempt rate
for the financial year concerned is--
(a) the rate prescribed by the regulations under
section 28-25 of the ITAA for calculating a
5 deduction for car expenses for a large car
using the "cents per kilometre method" in the
financial year immediately preceding the
financial year in which the allowance is paid
or payable; or
10 (b) if no rate referred to in paragraph (a) is
prescribed, the rate prescribed by the
regulations under this Act.
30 Accommodation allowances
(1) For the purposes of this Act, wages do not include
15 an accommodation allowance paid or payable to
an employee in respect of a night's absence from
the person's usual place of residence that does not
exceed the exempt rate.
(2) If the accommodation allowance paid or payable
20 to an employee in respect of a night's absence
from the person's usual place of residence exceeds
the exempt rate, wages include that allowance
only to the extent that it exceeds the exempt rate.
(3) For the purposes of this section, the exempt rate
25 for the financial year concerned is--
(a) the total reasonable amount for daily travel
allowance expenses using the lowest capital
city for the lowest salary band for the
financial year determined by the
30 Commissioner of Taxation of the
Commonwealth; or
(b) if no determination referred to in
paragraph (a) is in force, the rate
prescribed by the regulations.
561136B.I-22/5/2007 27 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 31
Division 7--Contractor provisions
31 Definitions
In this Division--
contract includes an agreement, arrangement or
5 undertaking, whether formal or informal and
whether express or implied;
relevant contract has the meaning given in
section 32;
re-supply of goods acquired from a person
10 includes--
(a) a supply to the person of goods in an
altered form or condition; and
(b) a supply to the person of goods in
which the first-mentioned goods have
15 been incorporated;
services includes results (whether goods or
services) of work performed;
supply includes supply by way of sale, exchange,
lease, hire or hire-purchase, and in relation to
20 services includes the providing, granting or
conferring of services.
32 What is a relevant contract?
(1) In this Division, a relevant contract in relation to
a financial year is a contract under which a person
25 (the designated person) during that financial year,
in the course of a business carried on by the
designated person--
(a) supplies to another person services for or in
relation to the performance of work; or
30 (b) has supplied to the designated person the
services of persons for or in relation to the
performance of work; or
561136B.I-22/5/2007 28 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 32
(c) gives out goods to natural persons for work
to be performed by those persons in respect
of those goods and for re-supply of the goods
to the designated person or, where the
5 designated person is a member of a group, to
another member of that group.
(2) However, a relevant contract does not include a
contract of service or a contract under which a
person (the designated person) during a financial
10 year in the course of a business carried on by the
designated person--
(a) is supplied with services for or in relation to
the performance of work that are ancillary to
the supply of goods under the contract by the
15 person by whom the services are supplied or
to the use of goods which are the property of
that person; or
(b) is supplied with services for or in relation to
the performance of work where--
20 (i) those services are of a kind not
ordinarily required by the designated
person and are performed by a person
who ordinarily performs services of
that kind to the public generally; or
25 (ii) those services are of a kind ordinarily
required by the designated person for
less than 180 days in a financial year;
or
(iii) those services are provided for a period
30 that does not exceed 90 days or for
periods that, in the aggregate, do not
exceed 90 days in that financial year
and are not services--
(A) provided by a person by whom
35 similar services are provided to
the designated person; or
561136B.I-22/5/2007 29 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 32
(B) for or in relation to the
performance of work where any of
the persons who perform the work
also perform similar work for the
5 designated person--
for periods that, in the aggregate,
exceed 90 days in that financial year; or
(iv) those services are supplied under a
contract to which subparagraphs (i)
10 to (iii) do not apply and the
Commissioner is satisfied that those
services are performed by a person who
ordinarily performs services of that
kind to the public generally in that
15 financial year; or
(c) is supplied by a person (the contractor) with
services for or in relation to the performance
of work under a contract to which
paragraphs (a) and (b) do not apply where
20 the work to which the services relate is
performed--
(i) by two or more persons employed by,
or who provide services for, the
contractor in the course of a business
25 carried on by the contractor; or
(ii) where the contractor is a partnership of
two or more natural persons, by one or
more of the members of the partnership
and one or more persons employed by,
30 or who provide services for, the
contractor in the course of a business
carried on by the contractor; or
561136B.I-22/5/2007 30 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 32
(iii) where the contractor is a natural person,
by the contractor and one or more
persons employed by, or who provide
services for, the contractor in the course
5 of a business carried on by the
contractor--
unless the Commissioner determines that the
contract or arrangement under which the
services are so supplied was entered into
10 with an intention either directly or indirectly
of avoiding or evading the payment of tax by
any person; or
(d) is supplied with--
(i) services ancillary to the conveyance of
15 goods by means of a vehicle provided
by the person conveying them; or
(ii) services solely for or in relation to the
procurement of persons desiring to be
insured by the designated person; or
20 (iii) services for or in relation to the door-
to-door sale of goods solely for
domestic purposes on behalf of the
designated person--
unless the Commissioner determines that the
25 contract or arrangement under which the
services are so supplied was entered into
with an intention either directly or indirectly
of avoiding or evading the payment of tax by
any person.
30 (3) For the purposes of this section, an employment
agency contract under which services are supplied
by an employment agent, or a service provider is
procured by an employment agent, is not a
relevant contract.
561136B.I-22/5/2007 31 BILL LA INTRODUCTION 22/5/2007
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Part 3--Wages
s. 33
33 Persons taken to be employers
(1) For the purposes of this Act, a person--
(a) who during a financial year, under a relevant
contract, supplies services to another person;
5 or
(b) to whom during a financial year, under a
relevant contract, the services of persons are
supplied for or in relation to the performance
of work; or
10 (c) who during a financial year, under a relevant
contract, gives out goods to other persons--
is taken to be an employer in respect of that
financial year.
(2) If a contract is a relevant contract under both
15 section 32(1)(a) and (b)--
(a) the person to whom, under the contract, the
services of persons are supplied for or in
relation to the performance of work is taken
to be an employer; and
20 (b) despite subsection (1)(a), the person who
under the contract supplies the services is
taken not to be an employer.
34 Persons taken to be employees
For the purposes of this Act, a person who during
25 a financial year--
(a) performs work for or in relation to which
services are supplied to another person under
a relevant contract; or
(b) being a natural person, under a relevant
30 contract, re-supplies goods to an employer--
is taken to be an employee in respect of that
financial year.
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Part 3--Wages
s. 35
35 Amounts under relevant contracts taken to be wages
(1) For the purposes of this Act, amounts paid or
payable by an employer during a financial year for
or in relation to the performance of work relating
5 to a relevant contract or the re-supply of goods by
an employee under a relevant contract are taken to
be wages paid or payable during that financial
year.
(2) If an amount referred to in subsection (1) is
10 included in a larger amount paid or payable by an
employer under a relevant contract during a
financial year, that part of the larger amount
which is not attributable to the performance of
work relating to the relevant contract or the re-
15 supply of goods by an employee under the
relevant contract is as determined by the
Commissioner.
(3) An amount paid or payable for or in relation to the
performance of work under a relevant contract is
20 taken to include--
(a) any payment made by a person who is taken
to be an employer under a relevant contract
in relation to a person who is taken to be an
employee under the relevant contract that
25 would be a superannuation contribution if
made in relation to a person in the capacity
of an employee; and
(b) the value of any share or option (not
otherwise included as wages under this Act)
30 provided or liable to be provided by a person
who is taken to be an employer under a
relevant contract in relation to a person who
is taken to be an employee under the relevant
contract that would be included as wages
35 under Division 4 if provided to a person in
the capacity of an employee.
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Part 3--Wages
s. 36
36 Liability provisions
If, in respect of a payment for or in relation to the
performance of work that is taken to be wages
under this Division, payroll tax is paid by a person
5 taken under this Division to be an employer--
(a) no other person is liable to payroll tax in
respect of that payment; and
(b) if another person is liable to make a payment
for or in relation to that work, that person is
10 not liable to payroll tax in respect of that
payment unless it or the payment by the first-
mentioned person is made with an intention
either directly or indirectly of avoiding or
evading the payment of tax whether by the
15 first-mentioned person or another person.
Division 8--Employment agents
37 Definitions
(1) For the purposes of this Act, an employment
agency contract is a contract, whether formal or
20 informal and whether express or implied, under
which a person (an employment agent) procures
the services of another person (a service provider)
for a client of the employment agent.
(2) However, a contract is not an employment agency
25 contract for the purposes of this Act if it is, or
results in the creation of, a contract of
employment between the service provider and the
client.
(3) In this section--
30 contract includes agreement, arrangement and
undertaking.
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Part 3--Wages
s. 38
38 Persons taken to be employers
For the purposes of this Act, the employment
agent under an employment agency contract is
taken to be an employer.
5 39 Persons taken to be employees
For the purposes of this Act, the person who
performs work for or in relation to which services
are supplied to the client under an employment
agency contract is taken to be an employee of the
10 employment agent.
40 Amounts taken to be wages
(1) For the purposes of this Act, the following are
taken to be wages paid or payable by the
employment agent under an employment agency
15 contract--
(a) any amount paid or payable to or in relation
to the service provider in respect of the
provision of services in connection with the
employment agency contract;
20 (b) the value of any benefit provided for or in
relation to the provision of services in
connection with the employment agency
contract that would be a fringe benefit if
provided to a person in the capacity of an
25 employee;
(c) any payment made in relation to the service
provider that would be a superannuation
contribution if made in relation to a person in
the capacity of an employee.
30 (2) Subsection (1) does not apply to an employment
agency contract to the extent that an amount,
benefit or payment referred to in that subsection
would be exempt from payroll tax under Part 4
(other than under Division 4 or 5 of that Part,
35 section 50 or clause 16 of Schedule 2) had the
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Part 3--Wages
s. 41
service provider been paid by the client as an
employee, if the client has given a declaration to
that effect, in the form approved by the
Commissioner, to the employment agent.
5 41 Liability provisions
Subject to section 42, if an employment agent
under an employment agency contract--
(a) by arrangement procures the services of a
service provider for a client of the
10 employment agent; and
(b) pays payroll tax in respect of an amount,
benefit or payment that is, under section 40,
taken to be wages paid or payable by the
employment agent in respect of the provision
15 of those services in connection with that
contract--
no other person (including any other person
engaged to procure the services of the service
provider for the employment agent's client as part
20 of the arrangement) is liable to pay payroll tax in
respect of wages paid or payable for the
procurement or performance of those services by
the service provider for the client.
42 Agreement to reduce or avoid liability to payroll tax
25 (1) If the effect of an employment agency contract is
to reduce or avoid the liability of any party to the
contract to the assessment, imposition or payment
of payroll tax, the Commissioner may--
(a) disregard the contract; and
30 (b) determine that any party to the contract is
taken to be an employer for the purposes of
this Act; and
(c) determine that any payment made in respect
of the contract is taken to be wages for the
35 purposes of this Act.
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Part 3--Wages
s. 43
(2) If the Commissioner makes a determination under
subsection (1), the Commissioner must serve a
notice of the determination on the person taken to
be an employer for the purposes of this Act.
5 (3) The notice must set out the facts on which the
Commissioner relies and the reasons for the
determination.
(4) This section has effect in relation to agreements,
transactions and arrangements made before, on or
10 after the commencement of this section.
Division 9--Other
43 Value of wages paid in kind
The value of wages (except fringe benefits and
shares and options) that are paid or payable in
15 kind is the greater of--
(a) the value agreed or attributed to the wages
in, or ascertainable for the wages from,
arrangements between the employer and the
employee, whichever is the greater; and
20 (b) if the regulations prescribe how the value of
wages of that type is to be determined--the
value determined in accordance with the
regulations.
44 GST excluded from wages
25 (1) If a person is liable to pay GST on the supply to
which wages paid or payable to the person relate,
the amount or value of those wages on which
payroll tax is payable is the amount or value of the
wages paid or payable to the person minus the
30 relevant proportion of the amount of GST payable
by the person on the supply to which the wages
relate.
(2) Subsection (1) does not apply in respect of the
value of wages comprising a fringe benefit.
561136B.I-22/5/2007 37 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 45
(3) In this section--
consideration has the same meaning as in the
A New Tax System (Goods and Services
Tax) Act 1999 of the Commonwealth;
5 relevant proportion, in relation to GST payable
on a supply to which wages relate, means the
proportion that the amount or value of the
wages bears to the consideration for the
supply to which the wages relate.
10 45 Wages paid by group employers
A reference in this Act to wages paid or payable
by a member of a group includes wages that
would be taken to be paid or payable by a member
of a group if the member were the employer of the
15 employee to whom the wages were paid.
46 Wages paid by or to third parties
(1) If any of the following amounts of money or other
valuable consideration would, if paid or given or
to be paid or given directly by an employer to an
20 employee, be or be included as wages paid or
payable by the employer to the employee for the
purposes of this Act, they are taken to be wages
paid or payable by the employer to the
employee--
25 (a) any money or other valuable consideration
paid or given, or to be paid or given, to an
employee, for the employee's services as an
employee of an employer, by a person other
than the employer;
30 (b) any money or other valuable consideration
paid or given, or to be paid or given, by an
employer, for an employee's services as the
employee of the employer, to a person other
than the employee;
561136B.I-22/5/2007 38 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 46
(c) any money or other valuable consideration
paid or given, or to be paid or given, by a
person other than an employer, for an
employee's services as an employee of the
5 employer, to a person other than the
employee.
(2) If any of the following amounts of money or other
valuable consideration would, if paid or given or
to be paid or given directly by a company to a
10 director of the company, be or be included as
wages paid or payable by the company to the
director for the purposes of this Act, they are
taken to be wages paid or payable by the company
to the director--
15 (a) any money or other valuable consideration
paid or given, or to be paid or given, to a
director of a company, by way of
remuneration for the appointment or services
of the director to the company, by a person
20 other than the company;
(b) any money or other valuable consideration
paid or given, or to be paid or given, by a
company, by way of remuneration for the
appointment or services of the director to the
25 company, to a person other than the director;
(c) any money or other valuable consideration
paid or given, or to be paid or given, by any
person, by way of remuneration for the
appointment or services of a director to the
30 company, to a person other than the director.
(3) In this section, director of a company includes--
(a) a person who, under a contract or other
arrangement, is to be appointed as a director
of the company; and
35 (b) a former director of the company.
561136B.I-22/5/2007 39 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 3--Wages
s. 47
47 Agreement etc. to reduce or avoid liability to payroll
tax
(1) If any person enters into any agreement,
transaction or arrangement, whether in writing or
5 otherwise, under which a natural person performs,
for or on behalf of another person, services in
respect of which any payment is made to some
other person related or connected to the natural
person performing the services and the effect of
10 the agreement, transaction or arrangement is to
reduce or avoid the liability of any person to the
assessment, imposition or payment of payroll tax,
the Commissioner may--
(a) disregard the agreement, transaction or
15 arrangement; and
(b) determine that any party to the agreement,
transaction or arrangement is taken to be an
employer for the purposes of this Act; and
(c) determine that any payment made in respect
20 of the agreement, transaction or arrangement
is taken to be wages for the purposes of this
Act.
(2) If the Commissioner makes a determination under
subsection (1), the Commissioner must serve a
25 notice to that effect on the person taken to be an
employer for the purposes of this Act.
(3) The notice must set out the facts on which the
Commissioner relies and the reasons for the
determination.
30 (4) This section has effect in relation to agreements,
transactions and arrangements made before, on or
after the commencement of this section.
__________________
561136B.I-22/5/2007 40 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 4--Exemptions
s. 48
PART 4--EXEMPTIONS
Division 1--Non-profit organisations
48 Non-profit organisations
(1) Subject to subsection (2), wages are exempt
5 wages if they are paid or payable by any of the
following--
(a) a religious institution;
(b) a public benevolent institution (but not
including an instrumentality of the State);
10 (c) a non-profit organisation having wholly
charitable, benevolent, philanthropic or
patriotic purposes (but not including a
school, an educational institution, an
educational company or an instrumentality of
15 the State).
(2) The wages must be paid or payable--
(a) for work of a kind ordinarily performed in
connection with the religious, charitable,
benevolent, philanthropic or patriotic
20 purposes of the institution or body; and
(b) to a person engaged exclusively in that kind
of work.
(3) For the purposes of subsection (1)(c), an
educational company is a company--
25 (a) in which an educational institution has a
controlling interest; and
(b) that provides, promotes or supports the
educational services of that institution.
(4) For the purposes of subsection (3), an educational
30 institution has a controlling interest in an
educational company if--
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Payroll Tax Bill 2007
Part 4--Exemptions
s. 49
(a) members of the board of management of the
company who are entitled to exercise a
majority in voting power at meetings of the
board of management are accustomed or
5 under an obligation, whether formal or
informal, to act in accordance with the
directions, instructions or wishes of the
educational institution; or
(b) the educational institution may (whether
10 directly or indirectly) exercise, control the
exercise of, or substantially influence the
exercise of, more than 50% of the voting
power attached to voting shares, or any class
of voting shares, issued by the company; or
15 (c) the educational institution has power to
appoint more than 50% of the members of
the board of management of the company.
(5) In this section--
educational institution means an entity that
20 provides education above secondary level.
Division 2--Education and training
49 Schools and educational services and training
Wages are exempt wages as provided for in
Division 1 of Part 3 of Schedule 2.
25 50 Community Development Employment Project
(1) Wages are exempt wages if they are paid or
payable to an Aboriginal person who is employed
under an employment project.
(2) An employment project is an employment project
30 under the Community Development Employment
Project funded by the Department of Employment
and Workplace Relations of the Commonwealth
or the Torres Strait Regional Authority.
561136B.I-22/5/2007 42 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 4--Exemptions
s. 51
Division 3--Health care service providers
51 Health care service providers
(1) Subject to subsection (2), wages paid or payable
by a health care service provider are exempt
5 wages.
(2) The wages must be paid or payable--
(a) for work of a kind ordinarily performed in
connection with the conduct of a health care
service provider; and
10 (b) to a person engaged exclusively in that kind
of work.
(3) For the purposes of this section, health care
service provider has the meaning given in
Division 2 of Part 3 of Schedule 2.
15 52 Division not to limit other exemptions
(1) Nothing in this Division limits the application of
any other Division of this Part.
(2) For example, if a health care service provider is
also a non-profit organisation, the exemption for
20 non-profit organisations referred to in section 48
may still apply.
Division 4--Maternity and adoption leave
53 Maternity and adoption leave
(1) Wages are exempt wages if they are paid or
25 payable to an employee in respect of--
(a) maternity leave, being leave given to a
female employee in connection with her
pregnancy or the birth of her child (other
than sick leave, recreation leave, annual
30 leave or any similar leave); or
561136B.I-22/5/2007 43 BILL LA INTRODUCTION 22/5/2007
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Part 4--Exemptions
s. 54
(b) adoption leave, being leave given to an
employee in connection with the adoption of
a child by him or her (other than sick leave,
recreation leave, annual leave or any similar
5 leave).
(2) It is immaterial whether the leave is taken during
or after the pregnancy or before or after the
adoption.
(3) The exemption is limited to wages paid or payable
10 in respect of a maximum of 14 weeks maternity
leave in respect of any one pregnancy and
14 weeks adoption leave in respect of any one
adoption.
(4) For the avoidance of doubt, a reference in
15 subsection (3) to a period of 14 weeks leave is a
reference to--
(a) a period that is the equivalent of 14 weeks
leave on full pay, in the case of full-time
employees who take leave on less than full
20 pay; or
(b) a period of 14 weeks leave at part-time rates
of pay, in the case of part-time employees.
(5) The exemption does not apply to any part of
wages paid or payable in respect of maternity or
25 adoption leave that comprises fringe benefits.
54 Administrative requirements for exemption
(1) An employer wishing to claim an exemption
under section 53 in respect of maternity leave
must obtain and keep a medical certificate in
30 respect of, or statutory declaration by, the
employee--
(a) stating that the employee is or was pregnant;
or
(b) stating that the employee has given birth and
35 the date of birth.
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Part 4--Exemptions
s. 55
(2) An employer wishing to claim an exemption
under section 53 in respect of adoption leave must
obtain and keep a statutory declaration by the
employee stating--
5 (a) that a child has been placed in the custody of
the employee pending the making of an
adoption order; or
(b) that an adoption order has been made or
recognised in favour of the employee.
10 Note
Section 55 of the Taxation Administration Act 1997
requires these records to be kept for at least 5 years unless
the Commissioner of State Revenue authorises earlier
destruction.
15 Division 5--Volunteer firefighters and emergency service
volunteers
55 Volunteer firefighters
Subject to section 57, wages are exempt wages if
they are paid or payable to an employee in respect
20 of any period when he or she was taking part in
bushfire fighting activities as a volunteer officer
or member of a brigade within the meaning of the
Country Fire Authority Act 1958.
56 Emergency service volunteers
25 Subject to section 57, wages are exempt wages if
they are paid or payable to an employee in respect
of any period when he or she was engaging in
emergency activities within the meaning of the
Emergency Management Act 1986 as a
30 volunteer emergency worker within the meaning
of that Act.
561136B.I-22/5/2007 45 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 4--Exemptions
s. 57
57 Limitation of exemption
An exemption under this Division does not apply
to wages paid or payable as recreation leave,
annual leave, long service leave or sick leave.
5 Division 6--Local government
58 Municipal councils
Subject to section 60, wages are exempt wages if
they are paid or payable by--
(a) a municipal council; or
10 (b) a union or partnership of which all the
members are municipal councils.
59 Local government business entities
(1) Subject to section 60, wages are exempt wages if
they are paid or payable--
15 (a) by a wholly-owned subsidiary (within the
meaning of the Corporations Act) of a
municipal council; and
(b) to a person for or in connection with an
activity that is conducted for the council
20 under a written arrangement between the
subsidiary and the council.
(2) The written arrangement referred to in
subsection (1)(b) must include a provision for the
payment by the subsidiary to the council of an
25 amount approximately equivalent to the amount of
tax that would be payable by the subsidiary under
this Act but for the exemption.
561136B.I-22/5/2007 46 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 4--Exemptions
s. 60
60 Limitation on local government exemptions
(1) An exemption under this Division does not apply
to wages paid or payable for or in connection
with--
5 (a) any of the activities referred to in
subsection (2); or
(b) the construction of any buildings or works,
or the installation of plant, machinery or
equipment for use in any of the activities
10 referred to in subsection (2).
(2) Subsection (1) applies to the following
activities--
(a) the supply of electricity or gas;
(b) water supply;
15 (c) sewerage;
(d) the conduct of--
(i) abattoirs;
(ii) public markets;
(iii) parking stations;
20 (iv) cemeteries or crematoria;
(v) hostels;
(vi) an activity prescribed by the
regulations;
(e) an activity specified in Schedule 2.
25 Division 7--Other government and defence
61 State Governors
Wages paid or payable by the Governor of a State
are exempt wages.
561136B.I-22/5/2007 47 BILL LA INTRODUCTION 22/5/2007
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Part 4--Exemptions
s. 62
62 Defence personnel
Wages are exempt wages if they are paid or
payable to an employee in respect of any period
when he or she was on leave from employment
5 because of being a member of--
(a) the Defence Force of the Commonwealth; or
(b) the armed forces of any part of the
Commonwealth of Nations.
63 War Graves Commission
10 Wages paid or payable by the Commonwealth
War Graves Commission are exempt wages.
Division 8--Foreign government representatives and
international agencies
64 Consular and non-diplomatic representatives
15 Wages paid or payable to members of his or her
official staff by a consular or other representative
of any country in Australia (other than a
diplomatic representative) are exempt wages.
65 Trade commissioners
20 Wages paid or payable to members of his or her
official staff by a Trade Commissioner
representing any other part of the Commonwealth
of Nations in Australia are exempt wages.
66 Australian-American Fulbright Commission
25 Wages paid or payable by the Australian-
American Fulbright Commission are exempt
wages.
__________________
561136B.I-22/5/2007 48 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 5--Grouping of employers
s. 67
PART 5--GROUPING OF EMPLOYERS
Division 1--Interpretation
67 Definitions
In this Part--
5 business includes--
(a) a profession or trade; and
(b) any other activity carried on for fee,
gain or reward; and
(c) the activity of employing one or more
10 persons who perform duties for or in
connection with another business; and
(d) the carrying on of a trust (including a
dormant trust); and
(e) the activity of holding any money or
15 property used for or in connection with
another business--
whether carried on by 1 person or 2 or more
persons together;
group means a group constituted under this Part,
20 but does not include any member of the
group in respect of whom a determination
under Division 4 is in force.
68 Grouping provisions to operate independently
The fact that a person is not a member of a group
25 constituted under a provision of this Part does not
prevent that person from being a member of a
group constituted under another provision of this
Part.
561136B.I-22/5/2007 49 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 5--Grouping of employers
s. 69
Division 2--Business groups
69 Constitution of groups
A group is constituted by all the persons or bodies
forming a group that is not a part of any larger
5 group.
70 Groups of corporations
(1) Corporations constitute a group if they are related
bodies corporate within the meaning of the
Corporations Act.
10 (2) For the purpose of assessing whether corporations
are related bodies corporate under that Act, they
are taken to carry on a business and not to be
trustee companies.
Note
15 Section 79 (Exclusion of persons from groups) allows the
Commissioner, for payroll tax purposes, to exclude persons
from a group constituted under this section in certain
circumstances but not in the case of corporations that are
related bodies corporate.
20 71 Groups arising from the use of common employees
(1) If one or more employees of an employer perform
duties for or in connection with one or more
businesses carried on by the employer and one or
more other persons, the employer and each of
25 those other persons constitute a group.
(2) If one or more employees of an employer are
employed solely or mainly to perform duties for
or in connection with one or more businesses
carried on by one or more other persons, the
30 employer and each of those other persons
constitute a group.
(3) If one or more employees of an employer perform
duties for or in connection with one or more
businesses carried on by one or more other
35 persons, being duties performed in connection
561136B.I-22/5/2007 50 BILL LA INTRODUCTION 22/5/2007
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Part 5--Grouping of employers
s. 72
with, or in fulfilment of the employer's obligation
under, an agreement, arrangement or undertaking
for the provision of services to any one or more of
those other persons in connection with that
5 business or those businesses, the employer and
each of those other persons constitute a group.
(4) Subsection (3) applies to an agreement,
arrangement or undertaking--
(a) whether the agreement, arrangement or
10 undertaking is formal or informal, express or
implied; and
(b) whether or not the agreement, arrangement
or undertaking provides for duties to be
performed by the employees or specifies the
15 duties to be performed by them.
Note
Section 79 (Exclusion of persons from groups) allows the
Commissioner, for payroll tax purposes, to exclude persons
from a group constituted under this section in certain
20 circumstances.
72 Groups of commonly controlled businesses
(1) If a person or set of persons has a controlling
interest in each of 2 businesses, the persons who
carry on those businesses constitute a group.
25 Note
Section 79 (Exclusion of persons from groups) allows the
Commissioner, for payroll tax purposes, to exclude persons
from a group constituted under this section in certain
circumstances.
30 (2) For the purposes of this section, a person or set of
persons has a controlling interest in a business
if--
(a) in the case of 1 person--the person is the
sole owner (whether or not as trustee) of the
35 business; or
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Part 5--Grouping of employers
s. 72
(b) in the case of a set of persons--the persons
are together as trustees the sole owners of the
business; or
(c) in the case of a business carried on by a
5 corporation--
(i) the person or each of the set of persons
is a director of the corporation and the
person or set of persons is entitled to
exercise more than 50% of the voting
10 power at meetings of the directors of
the corporation; or
(ii) a director or set of directors of the
corporation that is entitled to exercise
more than 50% of the voting power at
15 meetings of the directors of the
corporation is under an obligation,
whether formal or informal, to act in
accordance with the direction,
instructions or wishes of that person or
20 set of persons; or
(d) in the case of a business carried on by a body
corporate or unincorporate--that person or
set of persons constitute more than 50% of
the board of management (by whatever name
25 called) of the body or control the
composition of that board; or
(e) in the case of a business carried on by a
corporation that has a share capital--that
person or set of persons can, directly or
30 indirectly, exercise, control the exercise of,
or substantially influence the exercise of,
more than 50% of the voting power attached
to the voting shares, or any class of voting
shares, issued by the corporation; or
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Part 5--Grouping of employers
s. 72
(f) in the case of a business carried on by a
partnership--that person or set of persons--
(i) own (whether beneficially or not) more
than 50% of the capital of the
5 partnership; or
(ii) is entitled (whether beneficially or not)
to more than 50% of the profits of the
partnership; or
(g) in the case of a business carried on under a
10 trust--the person or set of persons (whether
or not as a trustee of, or beneficiary under,
another trust) is the beneficiary in respect of
more than 50% of the value of the interests
in the first-mentioned trust.
15 (3) If--
(a) 2 corporations are related bodies corporate
within the meaning of the Corporations Act;
and
(b) 1 of the corporations has a controlling
20 interest in a business--
the other corporation has a controlling interest in
the business.
(4) If--
(a) a person or set of persons has a controlling
25 interest in a business; and
(b) a person or set of persons who carry on the
business has a controlling interest in another
business--
the person or set of persons referred to in
30 paragraph (a) has a controlling interest in that
other business.
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Part 5--Grouping of employers
s. 72
(5) If--
(a) a person or set of persons is the beneficiary
of a trust in respect of more than 50% of the
value of the interests in the trust; and
5 (b) the trustee of the trust (whether alone or
together with another trustee or trustees) has
a controlling interest in the business of
another trust--
the person or set of persons has a controlling
10 interest in the business.
(6) A person who may benefit from a discretionary
trust as a result of the trustee or another person, or
the trustee and another person, exercising or
failing to exercise a power or discretion, is taken,
15 for the purposes of this Part, to be a beneficiary in
respect of more than 50% of the value of the
interests in the trust.
(7) If--
(a) a person or set of persons has a controlling
20 interest in the business of a trust; and
(b) the trustee of the trust (whether alone or
together with another trustee or trustees) has
a controlling interest in the business of a
corporation--
25 the person or set of persons is taken to have a
controlling interest in the business of the
corporation.
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Part 5--Grouping of employers
s. 73
(8) If--
(a) a person or set of persons has a controlling
interest in the business of a trust; and
(b) the trustee of the trust (whether alone or
5 together with another trustee or trustees) has
a controlling interest in the business of a
partnership--
the person or set of persons is taken to have a
controlling interest in the business of the
10 partnership.
73 Groups arising from tracing of interests in
corporations
(1) An entity and a corporation form part of a group if
the entity has a controlling interest in the
15 corporation.
Note
Section 79 (Exclusion of persons from groups) allows the
Commissioner, for payroll tax purposes, to exclude persons
from a group constituted under this section in certain
20 circumstances.
(2) For the purposes of this section, an entity has a
controlling interest in a corporation if the
corporation has share capital and--
(a) the entity has a direct interest in the
25 corporation and the value of that direct
interest exceeds 50%; or
(b) the entity has an indirect interest in the
corporation and the value of that indirect
interest exceeds 50%; or
30 (c) the entity has an aggregate interest in the
corporation and the value of the aggregate
interest exceeds 50%.
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Part 5--Grouping of employers
s. 73
(3) Division 3 applies for the purposes of the
interpretation of this section.
Note
Division 3 sets out the manner for determining whether an
5 entity has a direct interest, indirect interest or aggregate
interest in a corporation, and the value of such an interest.
(4) In this section--
associated person means a person who is
associated with another person in accordance
10 with any of the following provisions--
(a) persons are associated persons if they
are related persons;
(b) natural persons are associated persons
if they are partners in a partnership;
15 (c) private companies are associated
persons if common shareholders have a
majority interest in each private
company;
(d) trustees are associated persons if any
20 person is a beneficiary common to the
trusts (not including a public unit trust
scheme) of which they are trustees;
(e) a private company and a trustee are
associated persons if a related body
25 corporate of the company (within the
meaning of the Corporations Act) is a
beneficiary of the trust (not including a
public unit trust scheme) of which the
trustee is a trustee;
30 domestic partner of a person means a person to
whom the person is not married but with
whom the person is living as a couple on a
genuine domestic basis (irrespective of
gender);
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Part 5--Grouping of employers
s. 73
entity means--
(a) a person; or
(b) 2 or more persons who are associated
persons (as defined in this section);
5 private company means a company that is not
limited by shares, or whose shares are not
quoted on the Australian Stock Exchange or
any exchange of the World Federation of
Exchanges;
10 related person means a person who is related to
another person in accordance with any of the
following provisions--
(a) natural persons are related persons if--
(i) one is the spouse or domestic
15 partner of the other; or
(ii) the relationship between them is
that of parent and child, brothers,
sisters, or brother and sister;
(b) private companies are related persons if
20 they are related bodies corporate within
the meaning of the Corporations Act;
(c) a natural person and a private company
are related persons if the natural person
is a majority shareholder or director of
25 the company or of another private
company that is a related body
corporate of the company within the
meaning of the Corporations Act;
(d) a natural person and a trustee are
30 related persons if the natural person is a
beneficiary of the trust (not being a
public unit trust scheme) of which the
trustee is a trustee;
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Part 5--Grouping of employers
s. 74
(e) a private company and a trustee are
related persons if the company, or a
majority shareholder or director of the
company, is a beneficiary of the trust
5 (not being a public unit trust scheme) of
which the trustee is a trustee.
(5) For the purposes of the definition of domestic
partner in subsection (4), in determining whether
persons are domestic partners of each other, all the
10 circumstances of their relationship are to be taken
into account, including any one or more of the
matters referred to in section 275(2) of the
Property Law Act 1958 as may be relevant in a
particular case.
15 74 Smaller groups subsumed by larger groups
If a person is a member of 2 or more groups, the
members of all the groups together constitute a
group.
Note
20 Section 79 (Exclusion of persons from groups) allows the
Commissioner, for payroll tax purposes, to exclude persons
from a group constituted under this section in certain
circumstances.
Division 3--Business groups--tracing of interests in
25 corporations
75 Application
This Division applies for the purposes of
section 73 (Groups arising from tracing of
interests in corporations).
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Part 5--Grouping of employers
s. 76
76 Direct interest
(1) An entity has a direct interest in a corporation
if--
(a) in the case of an entity that is a person--the
5 person can, directly or indirectly, exercise,
control the exercise of, or substantially
influence the exercise of, the voting power
attached to any voting shares issued by the
corporation; or
10 (b) in the case of an entity that is 2 or more
persons who are associated persons--each of
the associated persons can, directly or
indirectly, exercise, control the exercise of,
or substantially influence the exercise of, the
15 voting power attached to any voting shares
issued by the corporation.
(2) The value of the direct interest of the entity in the
corporation is the proportion (expressed as a
percentage) of the voting power of all voting
20 shares issued by the corporation that--
(a) in the case of an entity that is a person--the
person can directly or indirectly exercise,
control the exercise of, or substantially
influence the exercise of, as referred to in
25 subsection (1); or
(b) in the case of an entity that is 2 or more
persons who are associated persons--the
associated persons can, if acting together,
directly or indirectly exercise, control the
30 exercise of, or substantially influence the
exercise of, as referred to in subsection (1).
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77 Indirect interest
(1) An entity has an indirect interest in a corporation
if the corporation is linked to another corporation
(the directly controlled corporation) in which the
5 entity has a direct interest.
(2) A corporation is linked to a directly controlled
corporation if the corporation is part of a chain of
corporations--
(a) that starts with the directly controlled
10 corporation; and
(b) in which a link in the chain is formed if a
corporation has a direct interest in the next
corporation in the chain.
(3) The following are examples of how subsections
15 (1) and (2) work (the examples are cumulative)--
(a) corporation A (a directly controlled
corporation) has a direct interest in
corporation B. Corporations A and B form
part of a chain of corporations, and
20 corporation B is linked to corporation A.
Accordingly, an entity that has a direct
interest in corporation A also has an indirect
interest in corporation B;
(b) corporation B also has a direct interest in
25 corporation C. In this case, corporations A, B
and C form part of a chain of corporations.
Both corporations B and C are linked to
corporation A. The entity that has a direct
interest in corporation A has an indirect
30 interest in both corporations B and C;
(c) corporation B also has a direct interest in
corporation D. There are now 2 chains of
corporations, one consisting of A, B and C,
and one consisting of A, B and D.
35 Corporations B, C and D are all linked to
corporation A and an entity that has a direct
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Part 5--Grouping of employers
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interest in corporation A would have an
indirect interest in corporations B, C and D.
An entity that has a direct interest in
corporation B would have an indirect interest
5 in corporations C and D. However, an entity
that has a direct interest in corporation C
only would not have an indirect interest in
corporation D, as corporation D is not linked
to corporation C.
10 (4) The value of the indirect interest of an entity in a
corporation (an indirectly controlled corporation)
that is linked to a directly controlled corporation is
calculated by multiplying together the
following--
15 (a) the value of the direct interest of the entity in
the directly controlled corporation;
(b) the value of each direct interest that forms a
link in the chain of corporations by which
the indirectly controlled corporation is linked
20 to the directly controlled corporation.
(5) The following are examples of how subsection (4)
works (the examples are cumulative)--
(a) an entity has a direct interest (with a value of
80%) in corporation A. Corporation A has a
25 direct interest (with a value of 70%) in
corporation B. The value of the indirect
interest of the entity in corporation B is
80% × 70% (that is, 56%). Accordingly, in
this example the entity has a controlling
30 interest (within the meaning of section 73
(Groups arising from tracing of interests in
corporations)) in corporation B;
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Part 5--Grouping of employers
s. 78
(b) corporation B also has a direct interest (with
a value of 40%) in corporation C. The value
of the indirect interest of the entity in
corporation C is 80% × 70% × 40% (that is,
5 224%). Accordingly, in this example the
entity does not have a controlling interest in
corporation C.
(6) It is possible for an entity to have more than one
indirect interest in a corporation. This may occur
10 if the corporation is linked to more than one
corporation in which the entity has a direct
interest, or if the corporation is linked to only one
corporation in which the entity has a direct
interest but is linked through more than one chain
15 of corporations. In that case, the entity has an
aggregate interest in the corporation (see
section 78 (Aggregation of interests)).
78 Aggregation of interests
(1) An entity has an aggregate interest in a
20 corporation if--
(a) the entity has a direct interest and one or
more indirect interests in the corporation; or
(b) the entity has more than one indirect interest
in the corporation.
25 (2) The value of the aggregate interest of an entity in
a corporation is the sum of the following--
(a) the value of the direct interest (if any) of the
entity in the corporation;
(b) the value of each indirect interest of the
30 entity in the corporation.
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(3) For example--
(a) an entity has a direct interest (with a value of
40%) in corporation B;
(b) the entity also has a direct interest (with a
5 value of 25%) in corporation A, which in
turn has a direct interest (with a value of
60%) in corporation B. Accordingly, the
entity also has an indirect interest in
corporation B with a value of 15% (that is,
10 25% × 60%);
(c) the value of the entity's aggregate interest in
corporation B is the sum of the direct interest
(40%) and the indirect interest (15%), which
is 55%;
15 (d) accordingly, in this example, the entity has a
controlling interest in corporation B (within
the meaning of section 73 (Groups arising
from tracing of interests in corporations)).
Division 4--Miscellaneous
20 79 Exclusion of persons from groups
(1) The Commissioner may, by order in writing,
determine that a person who would, but for the
determination, be a member of a group is not a
member of the group.
25 (2) The Commissioner may only make such a
determination if satisfied, having regard to the
nature and degree of ownership and control of the
businesses, the nature of the businesses and any
other matters the Commissioner considers
30 relevant, that a business carried on by the person,
is carried on independently of, and is not
connected with the carrying on of, a business
carried on by any other member of that group.
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(3) The Commissioner cannot exclude a person from
a group if the person is a body corporate that, by
reason of section 50 of the Corporations Act, is
related to another body corporate that is a member
5 of that group.
(4) This section extends to a group constituted by
reason of section 74 (Smaller groups subsumed by
larger groups).
(5) A determination can be expressed to take effect on
10 a date that is earlier than the date of the
determination.
(6) The Commissioner may by order in writing
revoke a determination that applies in respect of a
person if satisfied that the circumstances in which
15 a determination may be made do not apply to the
person.
(7) The revocation of a determination can be
expressed to take effect on a date that is earlier
than the date of the determination.
20 80 Designated group employers
(1) The members of a group may, with the approval
of the Commissioner, designate a qualified
member of the group to be the designated group
employer for the group for the purposes of this
25 Act.
(2) A member of a group is a qualified member if the
member--
(a) has paid during the preceding financial year
wages that exceeded $550 000; or
30 (b) is likely to pay during the current financial
year wages that are likely to exceed that
amount.
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Part 5--Grouping of employers
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(3) If none of the members of a group is a qualified
member but the members together--
(a) have paid during the preceding financial year
wages that exceeded $550 000; or
5 (b) are, in the opinion of the Commissioner,
likely to pay during the current financial year
wages that will exceed that amount--
the members may, with the approval of the
Commissioner, designate any member of the
10 group to be the designated group employer for the
group for the purposes of this Act.
(4) If the members of a group do not designate a
member as the designated group employer within
7 days after the end of the month in which the
15 group is established, the Commissioner may (but
is not obliged to) designate any member of the
group as the designated group employer.
(5) The designated group employer of a group stops
being the designated group employer from and
20 including the earlier of the following days--
(a) the first day of a return period during which
there is a change in the membership of the
group;
(b) the first day of a return period during which
25 the members of the group revoke the
designation.
(6) The designation of a designated group employer
under subsection (1) or (3) must be by notice in
writing.
30 (7) Such a notice must--
(a) be executed by or on behalf of each member
of the group; and
(b) be served on the Commissioner.
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Part 5--Grouping of employers
s. 81
81 Joint and several liability
(1) If a member of a group fails to pay an amount that
the member is required to pay under this Act in
respect of any period, every member of the group
5 is liable jointly and severally to pay that amount to
the Commissioner.
(2) If 2 or more persons are jointly or severally liable
to pay an amount under this section, the
Commissioner may recover the whole of the
10 amount from them, or any of them, or any one of
them.
(3) If, under this section, 2 or more persons are jointly
and severally liable to pay an amount that is
payable by any one of them, each person is also
15 jointly and severally liable to pay--
(a) any amount payable to the Commissioner
under this or any other Act in relation to that
amount, including any interest and penalty
tax; and
20 (b) any costs and expenses incurred in relation to
the recovery of that amount that the
Commissioner is entitled to recover from any
such person.
(4) A person who pays an amount in accordance with
25 the liability imposed by this section has such
rights of contribution or indemnity from the other
person or persons as are just.
(5) This section applies whether or not the person was
an employer during the relevant period.
__________________
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Part 6--Adjustments of Tax
s. 82
PART 6--ADJUSTMENTS OF TAX
82 Determination of correct amount of payroll tax
(1) For the purposes of this Part, the correct amount
of payroll tax payable by an employer in respect
5 of a financial year is the amount determined in
accordance with Schedule 1 in respect of that
financial year.
(2) This Part applies in respect of payroll tax paid or
payable whether as a group employer or as an
10 individual employer.
(3) If an employer is liable for payroll tax both as an
individual employer and as a group employer
(for different periods in the same financial year)
separate adjustments are to be made under this
15 Part in respect of any period as a group employer
and any period as an individual employer (and for
that purpose separate determinations of the correct
amount of payroll tax payable by the employer are
to be made).
20 (4) In this Part--
group employer means an employer who is a
member of a group;
individual employer means an employer who is
not a member of a group.
25 83 Annual adjustment of payroll tax
(1) If the amount of payroll tax paid or payable by an
employer when the employer made the returns
relating to a financial year is greater than the
correct amount of payroll tax payable by the
30 employer in respect of the financial year, the
Commissioner (on application by the employer) is
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Part 6--Adjustments of Tax
s. 84
to refund to that employer an amount equal to the
difference.
Note
There is a time limit on these refund applications--see
5 clause 22 of Schedule 2.
(2) If the amount of payroll tax paid or payable by an
employer when the employer made the returns
relating to a financial year is less than the correct
amount of payroll tax payable by the employer in
10 respect of the financial year, the employer must
pay to the Commissioner as payroll tax an amount
equal to the difference.
(3) Any amount payable by an employer under this
section in respect of a financial year must be paid
15 within the period during which the employer is
required to lodge a return under this Act in respect
of the return period that is or includes the month
of June in that financial year.
(4) The amount of any refund payable to an employer
20 in respect of a financial year under this section is
to be reduced by the amount of any other refund
of payroll tax made in respect of that financial
year to that employer (whether under this section
or otherwise) before the time of the refund under
25 this section.
84 Adjustment of payroll tax when employer changes
circumstances
(1) If an employer changes their circumstances during
a financial year, the employer must, if the amount
30 of payroll tax paid or payable by the employer
when the employer made returns relating to the
relevant period prior to the change of
circumstances is less than the correct amount of
payroll tax payable by the employer in respect of
35 the financial year, pay to the Commissioner as
payroll tax an amount equal to the difference.
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(2) A change of circumstances occurs when the
employer--
(a) ceases to pay or be liable to pay taxable
wages and interstate wages; or
5 (b) becomes a group employer (following a
period as an individual employer); or
(c) ceases to be a group employer (and becomes
an individual employer).
(3) The relevant period prior to a change of
10 circumstances is the period prior to the change
(during the financial year concerned and since any
prior change of circumstances) for which the
employer paid or was liable to pay taxable wages
or interstate wages.
15 (4) In calculating for the purposes of this section the
correct amount of payroll tax payable by the
employer, it is to be assumed that the wages paid
or payable by the employer during the relevant
period are the only wages paid or payable by the
20 employer during the financial year concerned.
(5) Any amount payable by an employer under this
section in respect of a relevant period must be
paid within the period during which the employer
is required to lodge a return under this Act relating
25 to that relevant period or the last return under this
Act relating to the relevant period.
(6) Any payroll tax paid or payable by an employer
under this section is to be included as payroll tax
paid or payable by the employer for the purposes
30 of the annual adjustment of payroll tax under this
Part.
Note
If an employer ceases to be a group employer during a
financial year an adjustment will be made under this section.
35 If later in that financial year the employer ceases to pay
wages there will be a further adjustment under this section.
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The first adjustment will adjust payroll tax paid for the
period as a group employer against the correct amount of tax
that should have been paid (based on the assumption that the
period as a group employer is the only period for which the
5 employer paid wages throughout the year). The second
adjustment will adjust payroll tax paid for the period as an
individual employer against the correct amount of tax that
should have been paid (based on the assumption that the
period as an individual employer is the only period for
10 which the employer paid wages throughout the year). Any
amount of payroll tax paid under this section is taken into
account for the purposes of the annual adjustment of payroll
tax.
85 Special provision where wages fluctuate
15 If a person who did not pay and was not liable to
pay taxable wages or interstate wages for any part
of a financial year satisfies the Commissioner that,
by reason of the nature of the person's trade or
business, the taxable wages and interstate wages,
20 if any, paid or payable by the person fluctuate
with different periods of the financial year, the
Commissioner may determine that the person is to
be treated for the purposes of this Part--
(a) if the person has conducted that trade or
25 business in Australia during the whole of the
financial year--as an employer who pays or
is liable to pay taxable wages throughout the
financial year; or
(b) if the person has conducted that trade or
30 business in Australia during part only of the
financial year--as an employer who pays or
is liable to pay taxable wages throughout that
last-mentioned part of the financial year.
Note
35 The effect of such a determination is that when the correct
amount of payroll tax is calculated (for the purposes of a tax
adjustment provided for by this Part) the employer may
receive the benefit of the payroll tax threshold for the period
for which the employer is to be treated as paying wages, and
40 not just for the period for which the employer actually pays
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wages. Without such a determination, an employer may only
receive the benefit of a proportion of the threshold amount
that is equivalent to the proportion of the whole financial
year for which the employer actually pays wages.
__________________
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Part 7--Registration and Returns
s. 86
PART 7--REGISTRATION AND RETURNS
86 Registration
(1) An employer who is not already registered must
apply for registration as an employer under this
5 Act if--
(a) during a month the employer pays or is liable
to pay, anywhere, wages of more than $9615
per week that are wholly or partly taxable
wages; or
10 (b) the employer is a member of a group the
members of which together during a month
pay or are liable to pay, anywhere, wages of
more than $9615 per week that are wholly or
partly taxable wages.
15 (2) The application for registration is to be made to
the Commissioner in a form and manner approved
by the Commissioner within 7 days after the end
of the month concerned.
(3) The Commissioner is to register the applicant as
20 an employer under this Act.
(4) The Commissioner may cancel the registration of
a person as an employer if satisfied that the person
has ceased to pay or to have a liability to pay
wages as described in subsection (1).
25 (5) If the Commissioner cancels the registration of a
person as an employer in any financial year and
that person subsequently pays or is liable to pay
taxable wages during that financial year, the
person may, despite the fact that the person is not
30 required to apply for registration, apply to the
Commissioner (in a form and manner approved by
the Commissioner) for registration as an
employer, and the Commissioner is then to
register the person as an employer under this Act.
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Part 7--Registration and Returns
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87 Returns
(1) Every employer who is registered or required to
apply for registration as an employer under this
Act must--
5 (a) within 7 days after the end of each month
except June, lodge with the Commissioner a
return relating to that month; and
(b) within 21 days after the end of June in each
year, lodge with the Commissioner a return
10 relating to that month and to the adjustment
of payroll tax paid or payable by the
employer during the financial year ending on
the close of that month.
(2) The designated group employer for a group may,
15 with the approval of the Commissioner, lodge a
joint return for the purposes of this section
covering specified members of the group
(including the designated group employer).
(3) If a joint return is lodged and the return would, if
20 lodged by a single employer, comply with this
section, each of the employers covered by the
return is taken to have complied with this section.
__________________
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Part 8--Collection and Recovery of Tax
s. 88
PART 8--COLLECTION AND RECOVERY OF TAX
Division 1--Agents and trustees generally
88 Application
(1) This Division applies to an agent of or trustee for
5 an employer.
(2) Nothing in this Division limits or otherwise
affects the application of Part 5 to an agent or
trustee, or 2 or more persons one or more of
whom is an agent or trustee.
10 89 Agents and trustees are answerable
An agent or trustee is answerable as the employer
for the doing of all things that are required to be
done by or under this Act in respect of the
payment of any wages which are subject to
15 payroll tax under this Act.
90 Returns by agent or trustee
(1) An agent or trustee must, in respect of the wages
referred to in section 89, make the returns required
under Part 7, but in a representative capacity only,
20 and each return must, except as otherwise
provided by this Act, be separate and distinct from
any other.
(2) In the case of an executor or administrator, the
returns must be the same as far as practicable as
25 the deceased person, if living, would have been
liable to make.
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91 Liability to pay tax
(1) An agent or trustee is personally liable for tax on
the wages referred to in section 89 if--
(a) after the Commissioner has required the
5 agent or trustee to make a return; or
(b) while the tax remains unpaid--
the agent or trustee, except with the written
permission of the Commissioner, disposes of or
parts with any fund or money which comes to the
10 agent or trustee from or out of which tax could
legally be paid.
(2) Otherwise than as provided in subsection (1), the
agent or trustee is not personally liable to pay the
tax in a representative capacity.
15 (3) The agent or trustee must retain from time to time
out of any money which comes to the agent or
trustee in a representative capacity enough to pay
the tax.
(4) For the purpose of ensuring the payment of tax,
20 the Commissioner has the same remedies against
attachable property of any kind vested in or under
the control or management or in the possession of
the agent or trustee, as the Commissioner has
against the property of any other person in respect
25 of tax, and in as full and ample a manner.
92 Indemnity for agent or trustee
(1) An agent or trustee is indemnified for all
payments that the agent or trustee makes under
this Act or in accordance with the requirements of
30 the Commissioner.
(2) An agent or trustee who pays tax as agent or
trustee may recover the amount paid from the
person on whose behalf it was paid, or deduct it
from any money in the agent's or trustee's hands
35 belonging to that person.
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Division 2--Special cases
93 Tax not paid during lifetime
(1) This section applies if, whether intentionally or
not, a person escapes full payment of tax in his or
5 her lifetime by reason of not having duly made
full, complete and accurate returns.
(2) The Commissioner has the same powers and
remedies against the trustees of the estate of the
person in respect of the liability to which the
10 person was subject as the Commissioner would
have had against the person if the person were still
living.
(3) The trustees must lodge the returns under this Act
that the Commissioner requires.
15 (4) The trustees are subject to tax to the same extent
as the deceased person would be subject to tax if
he or she were still living, but the Commissioner,
in any circumstances the Commissioner considers
appropriate, may remit tax payable by the trustees
20 under this section by any amount.
(5) The amount of any tax payable by the trustees is a
charge on all the deceased person's estate in their
hands in priority to all other encumbrances.
94 Payment of tax by executors or administrators
25 (1) If, at the time of an employer's death, he or she
had not paid the whole of the tax payable up to the
date of death, the Commissioner has the same
powers and remedies for the assessment and
recovery of tax from the executors and
30 administrators as the Commissioner would have
had against the employer, if the employer were
alive.
(2) The executors or administrators must lodge any of
the returns referred to in Part 7 that have not been
35 lodged by the deceased.
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Part 8--Collection and Recovery of Tax
s. 95
95 Assessment if no probate within 6 months of death
(1) If, in respect of the estate of any deceased
employer, probate has not been granted or letters
of administration have not been taken out within
5 6 months after the death, the Commissioner may
make an assessment under section 8 of the
Taxation Administration Act 1997 of the tax
liability of the deceased under this Act.
(2) The Commissioner must cause notice of the
10 assessment to be published twice in a daily
newspaper circulating in the State or Territory in
which the deceased resided.
(3) Any person claiming an interest in the estate of
the deceased may, within 60 days after the first
15 publication of notice of the assessment, lodge an
objection with the Commissioner in accordance
with Division 1 of Part 10 of the Taxation
Administration Act 1997.
(4) Subject to any amendment of the assessment by
20 the Commissioner or by the Supreme Court, the
assessment so made is conclusive evidence of the
indebtedness of the deceased to the
Commissioner.
(5) However, if probate of the will or letters of
25 administration of the estate of the deceased is or
are granted to a person after the assessment is first
published, that person may, within 60 days after
the date of the grant, lodge an objection in
accordance with Division 1 of Part 10 of the
30 Taxation Administration Act 1997.
96 Person in receipt or control of money for absentee
(1) This section applies to a person (the controller)
who has the receipt, control or disposal of money
belonging to a person resident out of Australia
35 (the principal) if the principal is liable to pay tax
under this Act.
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Part 8--Collection and Recovery of Tax
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(2) The controller must pay the tax payable by the
principal at the time, or within the period,
specified by the Commissioner.
(3) A controller who pays tax in accordance with
5 subsection (2) may recover the amount paid from
the principal or deduct it from any money in the
controller's hands belonging to the principal.
(4) A controller must from time to time retain out of
any money which comes to the controller on
10 behalf of the principal so much as is sufficient to
pay the tax which is or will become due by the
principal.
(5) A controller is personally liable for the tax
payable by the controller on behalf of the
15 principal if--
(a) after the tax becomes payable; or
(b) after the Commissioner has required the
controller to pay the tax--
the controller, except with the written permission
20 of the Commissioner, disposes of or parts with
any fund or money then in the controller's
possession, or which comes to the controller from
or out of which the tax could legally be paid.
(6) Otherwise than as provided in subsection (5), a
25 controller is not personally liable to pay the tax
payable by the principal.
(7) A controller is indemnified for all payments which
the controller makes under this Act or in
accordance with the requirements of the
30 Commissioner.
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Part 8--Collection and Recovery of Tax
s. 97
97 Agent for absentee principal winding-up business
(1) If an agent for an absentee principal has been
required by the principal to wind-up the principal's
business, the agent must notify the Commissioner
5 of the intention to wind-up the business before
taking any steps to wind it up.
Penalty: 5 penalty units.
(2) After receiving notice under subsection (1), the
Commissioner may notify the agent in writing
10 of--
(a) the amount (if any) of payroll tax for which
the principal is liable; and
(b) the date (at least 21 days after the notice is
given) by which the tax must be paid.
15 (3) An agent who is given notice under subsection (2)
must--
(a) set aside an amount out of the assets of the
principal's business that is sufficient to pay
the tax; and
20 (b) pay the tax to the Commissioner by the date
specified in the notice.
Penalty: 5 penalty units.
(4) If an agent contravenes this section, the agent is
personally liable for any tax that becomes payable
25 in respect of the principal's business.
98 Recovery of tax paid on behalf of another person
A person who, under the provisions of this Act,
pays any tax for or on behalf of another person is
entitled to recover the amount so paid from the
30 other person as a debt, together with the costs of
recovery, or to retain or deduct that amount out of
any money in the person's hands belonging or
payable to the other person.
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Part 8--Collection and Recovery of Tax
s. 99
99 Liquidator to give notice
(1) Within 14 days after becoming liquidator of a
company that has been an employer registered or
required to be registered under this Act, the
5 liquidator must give the Commissioner notice in
writing of the liquidator's appointment.
(2) As soon as practicable after receiving the notice,
the Commissioner must notify the liquidator of the
amount that appears to the Commissioner to be
10 sufficient to provide for any tax which is or will
become payable by the company.
(3) The liquidator--
(a) must not without leave of the Commissioner
part with any of the assets of the company
15 until the liquidator has been so notified; and
(b) must set aside out of the assets available for
the payment of the tax, assets to the value of
the amount so notified, or the whole of the
assets so available if they are of less than that
20 value; and
(c) is, to the extent of the value of the assets
which the liquidator is so required to set
aside, liable as trustee to pay the tax.
(4) A liquidator must not fail--
25 (a) to comply with this section; or
(b) as trustee duly to pay the tax for which the
liquidator is liable under subsection (3).
Penalty: 50 penalty units.
(5) If a liquidator commits an offence against
30 subsection (4), the liquidator is personally liable
to pay the tax, to the extent of the value of the
assets of which the liquidator has taken possession
and which are, or were at any time, available to
the liquidator for the payment of the tax.
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Part 8--Collection and Recovery of Tax
s. 99
(6) If more than one person is appointed as liquidator
or required by law to carry out the winding-up of
a company--
(a) the obligations and liabilities attaching to a
5 liquidator under this section attach to each of
those persons; and
(b) if any one of those persons has paid the tax
due in respect of the company being wound-
up, the others are each liable to pay that
10 person that person's equal share of the
amount of the tax so paid.
(7) Despite anything in this section, all costs, charges
and expenses that, in the Commissioner's opinion,
have been properly incurred by a liquidator in the
15 winding-up of a company, including the
remuneration of the liquidator, may be paid out of
the assets of the company in priority to any tax
payable in respect of the company.
(8) Nothing in this section--
20 (a) limits the liability of a liquidator under
section 91; or
(b) affects any of the provisions of the
Corporations Act.
__________________
561136B.I-22/5/2007 81 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 9--General
s. 100
PART 9--GENERAL
100 Provisions specific to this jurisdiction
Schedule 2, which contains provisions that are
applicable only to this jurisdiction, has effect.
5 Note
As stated in section 1(b), one of the purposes of this Act is
to harmonise payroll tax law with New South Wales.
However, there are some provisions of payroll tax law
which are specific to this jurisdiction, and these are set out
10 in Schedule 2.
101 Regulations
(1) The Governor in Council may make regulations
for or with respect to the following--
(a) the manner of making any application to the
15 Commissioner under this Act;
(b) the evidence that the Commissioner may
require for the purpose of determining
whether or not--
(i) an employer was an employer for part
20 only of a financial year; or
(ii) a person was a member of a group at
any time or during any period;
(c) the signing of returns, applications, notices,
statements or forms by or on behalf of
25 employers and deeming any return,
application, notice, statement or form signed
on behalf of an employer to have been
signed by the employer;
(d) the authentication of any certificate, notice or
30 other document issued for the purpose of this
Act or any regulation;
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Part 9--General
s. 101
(e) prescribing any matter which or thing
required or permitted by this Act to be
prescribed or necessary or convenient to be
prescribed to give effect to this Act.
5 (2) The regulations--
(a) may differ according to differences in time,
place or circumstances; and
(b) may impose penalties not exceeding
25 penalty units for a contravention of the
10 regulations.
__________________
561136B.I-22/5/2007 83 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 10--Repeals, Amendments and Transitional Provisions
s. 102
PART 10--REPEALS, AMENDMENTS AND TRANSITIONAL
PROVISIONS
Division 1--Pay-roll Tax Act 1971
102 Repeal of Pay-roll Tax Act 1971
5 See: The Pay-roll Tax Act 1971 is repealed.
Act No.
8154.
Reprint No. 11
as at
20 March
2007
and
amending
Act No.
24/2006.
LawToday:
www.
legislation.
vic.gov.au
103 Repeal of amending Act
See: The Pay-roll Tax (Amendment) Act 1985 is
Act No.
10212 repealed.
as amended
by
Act No.
77/1986.
LawToday:
www.
legislation.
vic.gov.au
561136B.I-22/5/2007 84 BILL LA INTRODUCTION 22/5/2007
Payroll Tax Bill 2007
Part 10--Repeals, Amendments and Transitional Provisions
s. 104
Division 2--Taxation Administration Act 1997
104 Taxation laws
For section 4(d) of the Taxation Administration See:
Act No.
Act 1997 substitute-- 40/1997.
Reprint No. 3
5 "(d) Payroll Tax Act 2007 and regulations made as at
1 January
under that Act;". 2006
and
amending
Act No.
84/2006.
LawToday:
www.
legislation.
vic.gov.au
105 Reassessments and refunds up to 5 years
In the Taxation Administration Act 1997--
(a) in section 9(3), for "3 years" (where twice
10 occurring) substitute "5 years";
(b) in section 13, for "3 years" substitute
"5 years";
(c) in section 19(1), for "3 years" substitute
"5 years";
15 (d) in section 115(3), for "3 years" substitute
"5 years".
106 Objections
In section 96(1)(d) of the Taxation
Administration Act 1997, for "Pay-roll Tax Act
20 1971" substitute "Payroll Tax Act 2007".
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Part 10--Repeals, Amendments and Transitional Provisions
s. 107
107 New clause 16 inserted in Schedule 1
After clause 15 in Schedule 1 to the Taxation
Administration Act 1997 insert--
"16 Reassessment and refund periods
5 extended to 5 years
(1) Section 9(3), as amended by section 105(a)
of the Payroll Tax Act 2007, applies to a
reassessment of an initial assessment of a tax
liability where the transaction, event or
10 occurrence giving rise to that tax liability
takes place on or after 1 July 2007.
(2) Section 9(3), as in force immediately before
the commencement of section 105(a) of the
Payroll Tax Act 2007, continues to apply to
15 a reassessment of an initial assessment of a
tax liability where the transaction, event or
occurrence giving rise to that tax liability
took place before 1 July 2007.
(3) Section 13, as amended by section 105(b) of
20 the Payroll Tax Act 2007, applies if the date
of service of the notice of assessment is on or
after 1 July 2007.
(4) Section 13, as in force immediately before
the commencement of section 105(b) of the
25 Payroll Tax Act 2007, continues to apply if
the date of service of the notice of
assessment was before 1 July 2007.
(5) Section 19(1), as amended by section 105(c)
of the Payroll Tax Act 2007, applies if the
30 tax in respect of which the application for a
refund is made was paid on or after 1 July
2004.
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Part 10--Repeals, Amendments and Transitional Provisions
s. 108
(6) Section 19(1), as in force immediately before
the commencement of section 105(c) of the
Payroll Tax Act 2007, continues to apply if
the tax in respect of which the application for
5 a refund is made was paid before 1 July
2004.
(7) Section 115(3), as amended by
section 105(d) of the Payroll Tax Act 2007,
applies on and after 1 July 2009.
10 (8) During the period commencing on and
including 1 July 2007 and ending on 30 June
2009, despite anything to the contrary in
section 115(3), the relevant period for the
purpose of section 115(2) is the period
15 commencing on 1 July 2004.".
Division 3--Amendment of this Act
108 Education and training
(1) In clause 13 of Schedule 2 to this Act--
(a) in the definition of Commission, for
20 "Vocational Education and Training Act
1990" substitute "Education and Training
Reform Act 2006";
(b) in the definition of new entrant, for
"section 10 of the Vocational Education
25 and Training Act 1990" substitute
"section 3.1.4 of the Education and
Training Reform Act 2006";
(c) for the definition of school substitute--
"school means a school that is--
30 (a) a non-Government school within the
meaning of the Education and
Training Reform Act 2006 that is
registered under that Act; and
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Part 10--Repeals, Amendments and Transitional Provisions
s. 109
(b) carried on by a person for no profit or
gain to the person or the individual
members of the person;";
(d) in the definition of school council, for
5 "Education Act 1958" substitute
"Education and Training Reform Act
2006".
(2) In clause 16(1)(a) of Schedule 2 to this Act, for
"section 51 of the Vocational Education and
10 Training Act 1990" substitute "Part 5.5 of the
Education and Training Reform Act 2006".
(3) In clause 16(3) of Schedule 2 to this Act, for
"Part 5 of the Vocational Education and
Training Act 1990" substitute "Part 5.5 of the
15 Education and Training Reform Act 2006".
(4) At the end of clause 11 of Schedule 3 to this Act
insert--
"(2) A notice in force under clause 16(2) of
Schedule 2 immediately before the
20 commencement of section 108 of this Act
remains in force on and after that
commencement as if it had been made under
that clause as amended by that section 108.".
Division 4--Other Acts
25 109 County Court Act 1958
In sections 10(7)(c), 11(14)(c) and 17AA(4)(c) of
the County Court Act 1958, for "pay-roll tax
payable under the Pay-roll Tax Act 1971"
substitute "payroll tax payable under the Payroll
30 Tax Act 2007".
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Part 10--Repeals, Amendments and Transitional Provisions
s. 110
110 Duties Act 2000
In the Duties Act 2000--
(a) in section 57M(3) and in the note at the foot
of section 57M(3), for "3 years" substitute
5 "5 years";
(b) in sections 250H(1), 260(2)(a) and 267(2),
for "3 years" substitute "5 years".
111 New clause 26 inserted in Schedule 2 to the Duties
Act 2000
10 At the end of Schedule 2 to the Duties Act 2000
insert--
"26 Payroll Tax Act 2007
(1) Section 267(2), as amended by
section 110(b) of the Payroll Tax Act 2007,
15 applies to an overpayment made on or after
1 July 2004.
(2) Section 267(2), as in force immediately
before the commencement of section 110(b)
of the Payroll Tax Act 2007, continues to
20 apply to an overpayment made before 1 July
2004.".
112 Land Tax Act 2005
In section 51 of the Land Tax Act 2005, for
"3 years" substitute "5 years".
25 113 Local Government Act 1989
In section 193(12) of the Local Government Act
1989, for "section 9A(1C) of the Pay-roll Tax
Act 1971" substitute "section 72(2) of the
Payroll Tax Act 2007".
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Part 10--Repeals, Amendments and Transitional Provisions
s. 114
114 Magistrates' Court Act 1989
(1) For clause 10(c) and (d) of Schedule 1 to the
Magistrates' Court Act 1989 substitute--
"(c) superannuation contributions (within the
5 meaning of the Payroll Tax Act 2007)
payable in respect of the magistrates; and
(d) payroll tax payable under the Payroll Tax
Act 2007 payable in respect of wages paid or
payable to the magistrates; and".
10 (2) For clause 12(c) and (d) of Schedule 1 to the
Magistrates' Court Act 1989 substitute--
"(c) superannuation contributions (within the
meaning of the Payroll Tax Act 2007)
payable in respect of acting magistrates; and
15 (d) payroll tax payable under the Payroll Tax
Act 2007 payable in respect of wages paid or
payable to acting magistrates; and".
115 Taxation (Reciprocal Powers) Act 1987
In section 3(1) of the Taxation (Reciprocal
20 Powers) Act 1987, in the definition of State
Taxation Act, for paragraph (c) substitute--
"(c) Payroll Tax Act 2007;".
116 Victorian Civil and Administrative Tribunal
Act 1998
25 In clause 2 of Schedule 1 to the Victorian Civil
and Administrative Tribunal Act 1998, in the
definition of taxing Act, for paragraph (f)
substitute--
"(f) Payroll Tax Act 2007;".
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Part 10--Repeals, Amendments and Transitional Provisions
s. 117
Division 5--Transitional provisions
117 Transitional provisions
Schedule 3, which contains transitional
provisions, has effect.
__________________
561136B.I-22/5/2007 91 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
SCHEDULES
SCHEDULE 1
Sections 8, 29(5), 82
CALCULATION OF PAYROLL TAX LIABILITY
5 PART 1--INTERPRETATION
1 Definitions
In this Schedule--
financial year means the financial year
commencing on 1 July 2007 or on 1 July in
10 any subsequent financial year;
R is--
(a) for the financial year commencing on
1 July 2007--5·05%;
(b) for the financial year commencing on
15 1 July 2008 or 1 July in any subsequent
year--5%;
relevant financial year means the financial year
to which the calculation of the relevant
payroll tax relates;
20 TA or threshold amount is $550 000.
__________________
561136B.I-22/5/2007 92 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
PART 2--EMPLOYERS WHO ARE NOT MEMBERS OF A
GROUP
2 Application of Part
This Part applies only to an employer who is not a
5 member of a group.
3 Definitions
In this Part--
C is the number of days in the relevant financial
year in respect of which the employer paid or
10 was liable to pay taxable wages or interstate
wages (otherwise than as a member of a
group);
IW represents the total interstate wages paid or
payable by the employer concerned
15 (otherwise than as a member of a group)
during the relevant financial year;
TW represents the total taxable wages paid or
payable by the employer concerned
(otherwise than as a member of a group)
20 during the relevant financial year.
4 Payroll of employer under threshold
An employer is not liable to pay payroll tax for a
financial year if the total taxable wages and
interstate wages paid or payable by the employer
25 (otherwise than as a member of a group) during
that year is not more than the employer's
threshold amount, being the amount calculated in
accordance with the following formula--
C
TA ×
365
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5 Payroll of employer over threshold
If the total taxable wages and interstate wages
paid or payable by an employer (otherwise than as
a member of a group) during a financial year is
5 more than the employer's threshold amount, the
employer is liable to pay as payroll tax for that
year the amount of dollars calculated in
accordance with the following formula--
TW C
TW - × TA × × R
TW + IW 365
__________________
561136B.I-22/5/2007 94 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
PART 3--GROUPS WITH A DESIGNATED GROUP
EMPLOYER
6 Application of Part
This Part applies only to an employer who is a
5 member of a group for which there is a designated
group employer.
7 Definitions
In this Part--
C is the number of days in the relevant financial
10 year in respect of which at least one member
of the group paid or was liable to pay (as a
member of the group) taxable wages or
interstate wages;
GIW represents the total interstate wages paid or
15 payable by the group concerned during the
relevant financial year;
GTW represents the total taxable wages paid or
payable by the group concerned during the
relevant financial year;
20 TW represents the total taxable wages paid or
payable by the employer concerned (as a
member of the group) during the relevant
financial year.
8 Payroll of group under threshold
25 None of the members of a group is liable to pay
payroll tax for the financial year if the total
taxable wages and interstate wages paid or
payable by the group during that year is not more
than the group threshold amount, being the
30 amount calculated in accordance with the
following formula--
C
TA ×
365
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9 Payroll of group over threshold
(1) If the total taxable wages and interstate wages
paid or payable by a group during the financial
year is more than the group threshold amount,
5 payroll tax is payable as provided by
subclauses (2) and (3).
(2) The designated group employer for the group is
liable to pay as payroll tax for the financial year
the amount of dollars calculated in accordance
10 with the following formula--
GTW C
TW - × TA × ×R
GTW + GIW 365
(3) Each member of the group (other than that
designated group employer) is liable to pay as
payroll tax for the financial year the amount of
15 dollars calculated in accordance with the
following formula--
TW × R
__________________
561136B.I-22/5/2007 96 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
PART 4--GROUPS WITH NO DESIGNATED GROUP
EMPLOYER
10 Application of Part
This Part applies only to an employer who is a
5 member of a group for which there is no
designated group employer.
11 Definition
In this Part--
TW represents the total taxable wages paid or
10 payable by the employer concerned (as a
member of the group) during the relevant
financial year.
12 Calculation of payroll tax
Each member of the group is liable to pay as
15 payroll tax for the financial year the amount of
dollars calculated in accordance with the
following formula--
TW × R
__________________
561136B.I-22/5/2007 97 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
PART 5--MOTOR VEHICLE ALLOWANCES
13 Continuous recording method
If an employer selects the continuous recording
method for the purposes of determining the
5 number of business kilometres travelled during
the financial year, the following details are
required to be recorded by the employer--
(a) the odometer readings at the beginning and
end of each business journey undertaken by
10 the person during a financial year by means
of a motor vehicle provided or maintained by
the person;
(b) the specific purpose for which each such
business journey was taken;
15 (c) the distance travelled by the person during
the financial year in the course of all such
business journeys (which is taken to be the
number of business kilometres travelled
during the financial year), calculated on the
20 basis of the odometer readings referred to in
paragraph (a).
14 Averaging method
(1) If an employer selects the averaging method for
the purposes of determining the number of
25 business kilometres travelled during the financial
year, the following details are required to be
recorded by the employer--
(a) the odometer readings at the beginning and
end of each business journey undertaken by
30 the person during the relevant 12-week
period by means of a motor vehicle provided
or maintained by the person;
Note
Clause 15 defines the relevant 12-week period.
561136B.I-22/5/2007 98 BILL LA INTRODUCTION 22/5/2007
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(b) the specific purpose for which each such
business journey was taken;
(c) the distance travelled by the person during
the relevant 12-week period in the course of
5 all such business journeys, calculated on the
basis of the odometer readings referred to in
paragraph (a);
(d) the odometer readings at the beginning and
end of the relevant 12-week period for each
10 motor vehicle provided or maintained by the
person for the purpose of undertaking
business journeys;
(e) the distance travelled by each such vehicle
during the relevant 12-week period,
15 calculated on the basis of the odometer
readings referred to in paragraph (d);
(f) the distance travelled by the person in the
course of business journeys undertaken by
means of each such vehicle during the
20 relevant 12-week period, calculated as a
percentage of the distance travelled by that
vehicle during that period (the relevant
percentage);
(g) the odometer readings at the beginning and
25 end of the financial year for each vehicle
provided or maintained by the person for the
purpose of undertaking business journeys;
(h) the distance travelled by each such vehicle
during the financial year, calculated on the
30 basis of the odometer readings referred to in
paragraph (g);
(i) the distance travelled by the person in the
course of business journeys undertaken by
means of each such vehicle during the
35 financial year (which is taken to be the
number of business kilometres travelled
561136B.I-22/5/2007 99 BILL LA INTRODUCTION 22/5/2007
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Sch. 1
during the financial year), calculated on the
basis that the percentage of that distance that
was travelled by the person in the course of
business journeys undertaken by means of
5 each such vehicle during the financial year is
the same as the relevant percentage.
(2) For the next succeeding 4 financial years after the
first financial year in which odometer details are
recorded in accordance with subclause (1), an
10 employer is not required to calculate the relevant
percentage, or record the details referred to in
subclause (1)(a)-(f), for the person but is required
to record the other details referred to in that
subclause.
15 (3) Accordingly, for the next succeeding 4 financial
years after the first financial year in which
odometer details are recorded in accordance with
subclause (1), the number of business kilometres
travelled during the financial year is to be
20 calculated (as referred to in subclause (1)(i)) on
the basis of the relevant percentage calculated for
the first financial year.
(4) Despite subclauses (2) and (3), an employer is
required to calculate the relevant percentage for a
25 financial year, and record the details referred to in
subclause (1)(a)-(f), if--
(a) the Commissioner serves a notice on the
employer before the commencement of a
financial year during that period directing the
30 employer to keep the details referred to in
subclause (1)(a)-(f) for that financial year; or
(b) the employer wishes to use the recording
method referred to in this clause for one or
more additional motor vehicles used by the
35 person in any financial year or for any other
reason.
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Sch. 1
(5) In a situation referred to in subclause (4), the new
record for the financial year replaces the relevant
percentage details previously recorded and
subclauses (2) and (3) apply in relation to the new
5 record for the financial year as if it were the first
financial year in which odometer details were
recorded.
(6) An employer who has adopted and employed the
method of recording referred to in subclauses (2)
10 and (3) for a person for 4 successive financial
years must, in the next succeeding financial year,
make a fresh recording of all the details specified
in subclause (1) if the employer intends to
continue to use the same method of recording for
15 the person. Subclauses (2) and (3) then apply in
relation to the new record for the financial year as
if it were the first financial year in which
odometer details were recorded.
(7) If the odometer of a motor vehicle is replaced or
20 recalibrated during any period for which its
readings are relevant for the purposes of this
clause, the odometer readings immediately before
and after the replacement or recalibration are to be
recorded.
25 15 Meaning of relevant 12-week period
(1) In clause 14, relevant 12-week period means a
continuous period of at least 12 weeks, selected by
the employer, throughout which a motor vehicle is
provided or maintained by a person. If the motor
30 vehicle is provided or maintained for less than
12 weeks, the period must be the entire period for
which the motor vehicle is provided or
maintained.
(2) The period may overlap the start or end of the
35 financial year, so long as it includes part of the
year.
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(3) If the averaging method is used for 2 or more
motor vehicles for the same financial year, the
odometer readings for those motor vehicles must
cover periods that are concurrent.
5 16 Replacing one motor vehicle with another motor
vehicle
(1) For the purposes of using the averaging method,
an employer may nominate one motor vehicle as
having replaced another motor vehicle with effect
10 from a day specified in the nomination.
(2) After the nomination takes effect, the replacement
motor vehicle is treated as the original motor
vehicle, and the original motor vehicle is treated
as a different motor vehicle. An employer need
15 not repeat for the replacement vehicle the steps
already taken for the original motor vehicle.
(3) An employer must record the nomination in
writing in the financial year in which the
nomination takes effect.
20 (4) However, the Commissioner may allow an
employer to record the nomination at a later time.
17 Changing method of recording
(1) An employer may change from using the
averaging method to using the continuous
25 recording method with effect from the beginning
of a financial year if the employer complies with
clause 13 in respect of the financial year.
(2) An employer may change from using the
continuous recording method to using the
30 averaging method with effect from the beginning
of a financial year if the employer complies with
clause 14 in respect of the financial year.
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18 Definition
In this Part--
business journey means--
(a) a journey undertaken in a motor vehicle
5 by a person otherwise than in the
application of the vehicle to a private
use, being an application that, if the
person is paid a motor vehicle
allowance for that use, results in the
10 provision of a fringe benefit (within the
meaning of the FBTA Act) by the
employer; or
(b) a journey undertaken in a motor vehicle
by a person in the course of producing
15 assessable income of the person (within
the meaning of the Income Tax
Assessment Act 1936 of the
Commonwealth).
__________________
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Sch. 2
SCHEDULE 2
Sections 8, 40(2), 49, 51, 60(2)(e), 100
VICTORIA SPECIFIC PROVISIONS
PART 1--INTRODUCTION
5 1 Introduction to Schedule
This Schedule sets out provisions that apply only
in this jurisdiction.
__________________
561136B.I-22/5/2007 104 BILL LA INTRODUCTION 22/5/2007
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Sch. 2
PART 2--CALCULATION OF MONTHLY PAYROLL TAX
Division 1--Rate of payroll tax
2 Rate of payroll tax
The rate of payroll tax in this jurisdiction is--
5 (a) for wages paid or payable before 1 July
2008--5·05%;
(b) for wages paid or payable on or after 1 July
2008--5%.
Division 2--Employers who are not members of a group
10 3 Application of Division
This Division applies only to an employer who is
not a member of a group.
4 Amount of payroll tax to be paid each month
(1) The amount of payroll tax payable by an employer
15 on taxable wages paid or payable by the employer
in a month is the amount of dollars calculated in
accordance with the following formula--
(TW - D ) × R
where--
20 TW represents the total taxable wages paid or
payable by the employer (otherwise than as a
member of a group) during the month;
D is the deductible amount referred to in
clause 5 or 6 (as the case requires);
25 R is the rate of tax referred to in clause 2.
(2) If D is equal to or more than TW in respect of a
month, the employer is not required to pay payroll
tax in respect of that month.
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5 Deductible amount for employer who does not pay
interstate wages
(1) For an employer who pays or is liable to pay
taxable wages in a month but does not pay and is
5 not liable to pay interstate wages in that month,
the deductible amount in respect of that month is
$45 833.
(2) Subclause (1) applies whether the employer pays
or is liable to pay wages for the whole of the
10 month or only part of the month.
6 Deductible amount for employer who pays interstate
wages
(1) The deductible amount for an employer who pays
or is liable to pay taxable wages and interstate
15 wages in a month is--
(a) if notice has been given under subclause (2)
and no determination under subclause (5) is
in force--the amount specified in the most
recent notice given under subclause (2); or
20 (b) if a determination is in force under
subclause (5)--the amount specified in the
determination.
(2) From time to time, the employer may give a
notice to the Commissioner, containing the
25 information required by the Commissioner, of an
amount, calculated in accordance with
subclause (3), that the employer claims to be the
employer's deductible amount for that month and
subsequent months.
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(3) The amount is to be calculated in accordance with
the following formula--
$45 833 × T
D=
(T + I)
where--
5 D is the deductible amount per month;
T represents the estimated taxable wages in the
financial year in which D will be applied;
I represents the estimated interstate wages in
the financial year in which D will be applied.
10 (4) The deductible amount claimed cannot be more
than the amount referred to in clause 5(1).
(5) At any time, the Commissioner may, by notice in
writing to the employer, determine an amount, not
more than the amount referred to in clause 5(1), as
15 the deductible amount for the employer for one or
more months specified in the determination.
(6) A determination under subclause (5) may be made
on application by the employer or on the
Commissioner's own motion.
20 (7) At any time, the Commissioner, by notice in
writing to the employer, may revoke a
determination made under subclause (5).
Division 3--Groups with a designated group employer
7 Application of Division
25 This Division applies only to an employer who is
a member of a group for which there is a
designated group employer.
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8 Amount of payroll tax to be paid each month
(1) If an approval is in force under section 87(2) for
the designated group employer to lodge a joint
return--
5 (a) the amount of payroll tax payable by the
designated group employer on taxable wages
paid or payable in a month by the employers
covered by the return is the amount of
dollars calculated in accordance with the
10 following formula--
(JTW - D ) × R
where--
JTW represents the total taxable wages paid
or payable during the month by the
15 employers covered by the return
(as members of a group);
D is the deductible amount referred to in
clause 9 or 10 (as the case requires);
R is the rate of tax referred to in clause 2;
20 (b) the amount of payroll tax payable by each
employer who is a member of the group but
is not covered by the return on taxable wages
paid or payable by the employer in a month
is the amount of dollars calculated in
25 accordance with the following formula--
TW × R
where--
TW represents the total taxable wages paid
or payable by the employer concerned
30 (as a member of the group) during the
relevant month;
R is the rate of tax referred to in clause 2.
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(2) If an approval under section 87(2) is not in force
for the designated group employer--
(a) the amount of payroll tax payable by the
designated group employer on taxable wages
5 paid or payable by the designated group
employer in a month is the amount of dollars
calculated in accordance with the following
formula--
(TW - D ) × R
10 where--
TW represents the total taxable wages paid
or payable by the designated group
employer (as a member of a group)
during the month;
15 D is the deductible amount referred to in
clause 9 or 10 (as the case requires);
R is the rate of tax referred to in clause 2;
(b) the amount of payroll tax payable by each
employer who is a member of the group on
20 taxable wages paid or payable by the
employer in a month is the amount of dollars
calculated in accordance with the following
formula--
TW × R
25 where--
TW represents the total taxable wages paid
or payable by the employer concerned
(as a member of the group) during the
relevant month;
30 R is the rate of tax referred to in clause 2.
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(3) For the purposes of subclauses (1)(a) and (2)(a), if
D is equal to or more than JTW or TW in respect
of a month (as the case requires), the designated
group employer is not required to pay payroll tax
5 in respect of that month.
9 Deductible amount for groups that do not pay
interstate wages
(1) For a group in which one or more members pay or
are liable to pay taxable wages in a month but no
10 members pay or are liable to pay interstate wages
in that month, the deductible amount in respect of
that month is $45 833.
(2) Subclause (1) applies whether group members pay
or are liable to pay wages for the whole of the
15 month or only part of the month.
10 Deductible amount for groups that pay interstate
wages
(1) The deductible amount for a group in which one
or more members pay or are liable to pay taxable
20 wages or interstate wages in a month is--
(a) if notice has been given under subclause (2)
and no determination under subclause (5) is
in force--the amount specified in the most
recent notice given under subclause (2); or
25 (b) if a determination is in force under
subclause (5)--the amount specified in the
determination.
(2) From time to time, the designated group employer
may give a notice to the Commissioner,
30 containing the information required by the
Commissioner, of an amount, calculated in
accordance with subclause (3), that the employer
claims to be the group's deductible amount for that
month and subsequent months.
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(3) The amount is to be calculated in accordance with
the following formula--
$45 833 × T
D =
(T + I)
where--
5 D is the deductible amount per month;
T represents the estimated taxable wages
payable by the group in the financial year in
which D will be applied;
I represents the estimated interstate wages
10 payable by the group in the financial year in
which D will be applied.
(4) The deductible amount claimed cannot be more
than the amount referred to in clause 9(1).
(5) At any time, the Commissioner may, by notice in
15 writing to the designated group employer,
determine an amount, not more than the amount
referred to in clause 9(1), as the deductible
amount for the group for one or more months
specified in the determination.
20 (6) A determination under subclause (5) may be made
on application by the designated group employer
or on the Commissioner's own motion.
(7) At any time, the Commissioner, by notice in
writing to the designated group employer, may
25 revoke a determination made under subclause (5).
Division 4--Groups with no designated group employer
11 Application of Division
This Division applies only to an employer who is
a member of a group for which there is no
30 designated group employer.
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12 Amount of payroll tax to be paid each month
The amount of payroll tax payable by each
member of the group on taxable wages paid or
payable by the member in a month is the amount
5 of dollars calculated in accordance with the
following formula--
TW × R
where--
TW represents the total taxable wages paid or
10 payable by the employer concerned (as a
member of the group) during the relevant
month;
R is the rate of tax referred to in clause 2.
__________________
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PART 3--EXEMPTIONS
Division 1--Education and training
13 Definitions
In this Division--
5 Commission has the same meaning as in the
Vocational Education and Training Act
1990;
new entrant means an apprentice or trainee who
meets the requirements of the Commission
10 for eligibility for funding as a new entrant
under the applicable performance agreement
under section 10 of the Vocational
Education and Training Act 1990;
school means a school that is--
15 (a) registered under Part III of the
Education Act 1958; and
(b) carried on by a person for no profit or
gain to the person or the individual
members of the person;
20 school council has the same meaning as in the
Education Act 1958.
14 Schools and school councils
(1) Wages paid or payable by a school to a person in
relation to the provision of education within that
25 school are exempt wages.
(2) Wages paid or payable by a school council to a
person in relation to the provision of education are
exempt wages.
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15 Persons providing educational services
Wages are exempt wages if they are paid or
payable for an educational service that is provided
by a person in connection with the curriculum of a
5 school (otherwise than for the purpose of profit or
gain to the person or the individual members of
the person).
16 Approved training schemes
(1) Wages are exempt wages if they are paid or
10 payable to a new entrant who is employed--
(a) in accordance with the requirements of an
approved training scheme under section 51
of the Vocational Education and Training
Act 1990; and
15 (b) by a non-profit organisation that is declared
to be an approved group training
organisation under subclause (2).
(2) The Treasurer, by notice published in the
Government Gazette, may declare a non-profit
20 organisation to be an approved group training
organisation for the purposes of this Division.
(3) The Treasurer must consult the Minister
administering Part 5 of the Vocational Education
and Training Act 1990 before making a
25 declaration under subclause (2).
Division 2--Health care service providers
17 What is a health care service provider?
(1) For the purposes of Division 3 of Part 4 of this
Act, a health care service provider is--
30 (a) an ambulance service;
(b) a community health centre;
(c) a denominational hospital;
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(d) a multi-purpose service;
(e) a non-profit hospital;
(f) a public health service;
(g) a public hospital;
5 (h) the Victorian Institute of Forensic Mental
Health established by section 117B of the
Mental Health Act 1986.
(2) In this clause--
ambulance service means an ambulance service
10 created under section 23 of the Ambulance
Services Act 1986;
community health centre means an agency--
(a) registered under Division 2 of Part 3 of
the Health Services Act 1988; and
15 (b) in respect of which a declaration under
section 45 of that Act is in force;
denominational hospital means a hospital listed
in Schedule 2 to the Health Services Act
1988;
20 multi-purpose service means--
(a) a body referred to in section 115V(2) of
the Health Services Act 1988; or
(b) a body declared under Part 4A of that
Act to be a multi-purpose service;
25 non-profit hospital means a hospital carried on by
a body corporate, society or association
(otherwise than for the purpose of profit or
gain to the individual members of the body
corporate, society or association);
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public health service means a public health
service listed in Schedule 5 to the Health
Services Act 1988;
public hospital means a hospital listed in
5 Schedule 1 to the Health Services Act 1988.
Division 3--Local government
18 Limitation on local government exemptions
For the purposes of section 60(2)(e), the following
activities are specified--
10 (a) quarrying;
(b) conduct of ice works;
(c) cement pipe manufacture;
(d) operation of port and harbour facilities;
(e) provision of public transport facilities.
15 Division 4--Other exemptions
19 Specialized agencies
(1) Wages paid or payable by a specialized agency
are exempt wages.
(2) A specialized agency has the same meaning as in
20 section 1 of the Convention on the Privileges and
Immunities of the Specialized Agencies, which
was adopted by the General Assembly of the
United Nations on the 21 November 1947.
__________________
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PART 4--RETURNS AND REFUNDS
20 Further returns
The Commissioner may, by notice in writing, call
upon any employer or person to lodge, within the
5 time specified in the notice, a return or further or
fuller return as the Commissioner requires,
whether on the person's own behalf or as an agent
or trustee.
21 Notification of change in circumstances
10 An employer must give the Commissioner written
notice within 14 days--
(a) after any change in the employer's--
(i) name; or
(ii) trading name; or
15 (iii) location of head office; or
(iv) postal address; or
(v) members, if the employer is a
partnership; or
(b) after the employer ceases to--
20 (i) pay wages as referred to in
section 86(1)(a); or
(ii) be a member of a group referred to in
section 86(1)(b); or
(c) after the employer becomes a member of a
25 group referred to in section 86(1)(b).
Penalty: 20 penalty units.
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22 Time limit for refund applications
An application for a refund due under section 83
must be made before the end of the financial year
next following the financial year in respect of
5 which the refund is due.
__________________
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PART 5--GENERAL
23 Disregarding cents
If, for the purposes of this Act, it is necessary--
(a) to calculate the proportion that one amount
5 bears to another amount; or
(b) to calculate an amount in accordance with a
formula--
and, but for this clause, one or more of those
amounts or an amount included in the formula
10 would be amounts of dollars and cents--the cents
are to be disregarded.
__________________
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SCHEDULE 3
Section 117
TRANSITIONAL PROVISIONS
1 Definition
5 In this Schedule--
old Act means the Pay-roll Tax Act 1971 as in
force immediately before its repeal.
Note
The Pay-roll Tax Act 1971 is repealed by section 102 of
10 this Act, which comes into operation on 1 July 2007.
2 Savings and transitional regulations
(1) The regulations may contain provisions of a
savings and transitional nature consequent on the
enactment of this Act.
15 (2) Any such provision may, if the regulations so
provide, take effect from the date of assent to the
Act concerned or a later date.
(3) To the extent to which any such provision takes
effect from a date that is earlier than the date of its
20 publication in the Gazette, the provision does not
operate so as--
(a) to affect, in a manner prejudicial to any
person (other than the State or an authority
of the State), the rights of that person
25 existing before the date of its publication; or
(b) to impose liabilities on any person (other
than the State or an authority of the State) in
respect of anything done or omitted to be
done before the date of its publication.
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3 Application of Interpretation of Legislation
Act 1984
Except where the contrary intention appears, this
Schedule does not affect or take away from the
5 Interpretation of Legislation Act 1984.
4 Continuation of old Act and regulations
If a provision of the old Act continues to apply by
force of this Schedule, the following provisions
also continue to apply in relation to that
10 provision--
(a) any other provision of the old Act necessary
to give effect to that continued provision;
(b) any regulation made under the old Act for
the purposes of that continued provision.
15 5 Application of this Act and old Act
(1) This Act applies to payroll tax on taxable wages
that are paid or payable on or after 1 July 2007.
(2) Despite its repeal, the old Act continues to apply
to payroll tax on taxable wages (within the
20 meaning of the old Act) paid or payable before
1 July 2007.
(3) The following enactments, as in force
immediately before 1 July 2007, continue to apply
on and after that day in respect of any matter to
25 which the old Act continues to apply on and after
that day--
(a) Taxation Administration Act 1997 and
regulations made under that Act;
(b) Taxation (Reciprocal Powers) Act 1987;
30 (c) Victorian Civil and Administrative
Tribunal Act 1998 and regulations and rules
made under that Act.
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6 Fringe benefits
(1) An election by an employer under section 13A(2)
of the old Act that was in force immediately
before 1 July 2007 remains in force on and after
5 that day for the purposes of this Act as if it were
an election made by the employer under
section 16(1) of this Act.
(2) If an employer is a prescribed sporting club, a
reference in section 16(1) to the amount
10 determined in accordance with subsection (2) in
relation to that employer is taken to be a reference
to the sum of the type 1 aggregate fringe benefits
amount and the type 2 aggregate fringe benefits
amount (within the meaning of the FBTA Act) in
15 relation to that employer.
(3) In this clause--
competitive sporting activity includes the playing
of a sport, but does not include--
(a) the umpiring or refereeing of a sporting
20 activity; or
(b) the administration of a sporting
activity; or
(c) the non-competitive practice of a sport;
prescribed sporting club means--
25 (a) a prescribed sporting club referred to in
the Schedule to the Pay-roll Tax
(Prescribed Sporting Club) Regulations
2001 as in force immediately before
1 July 2007 (other than the body
30 referred to in item 1 in that Schedule);
or
(b) North Melbourne Kangaroos Limited
A.C.N. 065 251 489; or
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(c) a body prescribed by the regulations,
being an association, club or other
body--
(i) an object of which is to participate
5 in, facilitate or promote a sporting
activity; and
(ii) that employs persons who play for
the body in a competitive sporting
activity; and
10 (iii) that pays more than 50% of its
total wages in a financial year to
persons referred to in
subparagraph (ii) in respect of
services performed by those
15 players being the playing of a
sport.
(4) Subclauses (2) and (3) and this subclause are
repealed on 1 July 2008.
7 Superannuation contributions relating to pre-1 July
20 1997 service
(1) Despite anything in section 11 or 17, wages do not
include a superannuation contribution paid or
payable in respect of services performed by an
employee before 1 July 1997.
25 (2) A superannuation contribution that is alleged by
an employer to be paid in respect of services
performed by an employee before 1 July 1997
must be evidenced to the satisfaction of the
Commissioner in the employer's records for
30 payroll tax purposes.
(3) In particular, the employer's records must show
the manner of calculation of the contribution and
any actuarial basis for it.
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(4) For the purposes of subclause (3) and of any
assessment of payroll tax to which that subclause
is material, the certificate of a fellow or accredited
member of the Institute of Actuaries of Australia
5 to the effect that the actuarial basis on which an
amount is calculated is justified is evidence and,
in the absence of evidence to the contrary, proof
of that fact.
(5) If records are not kept as required by this clause,
10 the Commissioner is entitled to assume that a
payment of money by an employer as a
superannuation contribution on or after 1 July
1997 is an amount payable in respect of services
performed by an employee on or after that day.
15 8 Superannuation contributions not readily related to
particular employees
For the purposes of an assessment of payroll tax,
the Commissioner may determine--
(a) whether, and the extent to which, any
20 monetary or non-monetary contribution paid
or payable by an employer to a
superannuation, provident or retirement fund
or scheme that is not identified by the
employer as paid or payable in respect of a
25 particular employee (and whether or not
purporting to be so paid or payable on any
actuarial basis) is to be regarded as a
superannuation contribution paid or payable
in respect of a particular employee;
30 (b) the portion of any monetary or non-monetary
contribution paid by an employer as a
superannuation contribution to a wholly or
partly unfunded fund or scheme, being
money paid in respect of an employee
35 (or that is to be regarded under paragraph (a)
to have been so paid) who performed
services to the employer on or after, as well
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as before, 1 July 1997, that is to be regarded
as having been paid in respect of services
performed before that date.
9 Employment agents
5 A declaration under section 5(3) of the old Act
that was in force immediately before 1 July 2007
remains in force on and after that day for the
purposes of this Act as if it were a declaration
made under section 40(2) of this Act.
10 10 Exemption continues for certain schools
For the purposes of Division 1 of Part 3 of
Schedule 2, a school includes--
(a) a school or college that--
(i) is carried on by a body corporate,
15 society or association for no profit or
gain to the individual members of the
body corporate, society or association
and is not carried on by or on behalf of
the State; and
20 (ii) provides education at or below the
secondary level of education and to
students, the majority of whom are
aged under 19 years of age; and
(iii) was in existence as such a college
25 before 27 May 1997; and
(b) a school or college within the meaning of
section 10(1)(da) of the Pay-roll Tax Act
1971 as in force immediately before the
commencement of section 19(a) of the State
30 Taxation Legislation (Further
Amendment) Act 2002.
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11 Approved training schemes
A notice in force under section 10(1)(k)(ii) of the
old Act immediately before 1 July 2007 remains
in force on and after that day for the purposes of
5 clause 16 of Schedule 2 to this Act as if it were a
notice published under clause 16(2) of that
Schedule.
12 Exemption continues for public hospitals
For the purposes of Division 2 of Part 3 of
10 Schedule 2, a public hospital includes a public
hospital within the meaning of section 10(1)(bc)
of the Pay-roll Tax Act 1971 as in force
immediately before the commencement of
section 14(1) of the State Taxation Legislation
15 (Miscellaneous Amendments) Act 2006.
13 Registration of employers
An employer who was registered under section 12
of the old Act immediately before 1 July 2007 is
taken, on and after that day, to be registered under
20 section 86 of this Act.
14 Designated group employers
A member of a group who was the nominated or
appointed member for the group under
section 9A(4) of the old Act immediately before
25 1 July 2007 is taken, on and after that day, to be
the designated group employer for the group as if
the member had been designated under section 80
of this Act.
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Endnotes
ENDNOTES
By Authority. Government Printer for the State of Victoria.
561136B.I-22/5/2007 127 BILL LA INTRODUCTION 22/5/2007
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