A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Select the first letter of the word from the list above to jump to appropriate section of the glossary.
An Australia Wide Group exists when organisations related through the grouping provisions of the Pay-roll Tax Act 1971 have group members that pay wages in South Australia and another State and/or Territory of Australia.
Details relating to the grouping provisions can be found in, 'A Guide to Legislation, Pay-roll Tax Act 1971'.
An Australia Wide Group will consist of a DI status code taxpayer which is referred to as the Designated Group Employer (DGE) but will not necessarily have other group members registered for South Australian pay-roll tax, as only group members that individually pay wages in South Australia are required to be registered for South Australian pay-roll tax. Group members that employ in South Australia that are not the DGE are refer to as GI status taxpayers.
An Australia Wide Group is entitled to a proportional deduction in each State and/or Territory that the group employed. The proportion is based on the percentage of the Australia wide wages the group paid in each jurisdiction. The Australia wide wages of the group are the sum of all wages paid by the group throughout Australia by all group members whether or not they are required to be registered for South Australian pay-roll tax.
If the whole deduction entitlement is not used by the DGE, RevenueSA will either apportion the unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group.
A bonus is a reward paid to an employee for the services that they have conducted. Whether the bonus originates from the employee reaching a pre-determined objective or is paid in appreciation of the services they have conducted the bonus is paid as a reward for the employees services. Accordingly such a payment is liable to pay-roll tax in South Australia.
Allowances are generally payments that are made to employees for specific work costs that will be incurred. Allowances though are not restricted to recompensing the employee for expenses they normally meet. They can also be made to compensate for working in arduous, dirty or dangerous conditions. As allowances are paid as part of the employees agreed employment terms they are taxable for South Australian pay-roll tax purposes. Generally the full amount of the allowance is taxable. However, there are two exceptions to this rule, these being travel allowances and accommodations allowance. Further information regarding the two exceptions can be found in, 'A Guide to Legislation, Pay-roll Tax Act 1971'.
A commission is a payment made to an employee based on a percentage of the profits earned by the employer for the services rendered by the employee. As such a payment is a reward for the employees services, commissions are taxable for South Australian pay-roll tax purposes.
The Pay-roll Tax Act 1971 contains provisions that deem all service contractors as being employees of the contracting entity, unless one of the specified exclusion criteria is met. These provisions are aimed at schemes designed to avoid liability for pay-roll tax by severing the employer/employee relationship.
Where a service contract is deemed taxable for South Australian pay-roll tax purposes the amount to be declared as taxable wages is the amount payable under the contract less amounts payable for materials/equipment and any goods and services tax payable upon the contract. Where the contract does not distinguish between labour and other costs the Commissioner has determined a specific deduction percentage for particular contract classes, for the non-labour costs component of the contract.
For the service contract to be excluded from the calculation of taxable wages one of the exclusion criteria must be met. Some of the criteria used in determining whether a service contract can be excluded from the contractor provisions are, what is to be provided under the contract, how many people are required to perform the services required under the contract, the number of days work required to complete the contract and whether the services provided under the contract are generally provided by the contracted organisation to the public in general. Contracts for the services of Owner/Drivers of a goods carrier, Insurance Sales Agents and Door-to-Door Sales Agents are specifically excluded from taxable wages.
Further information regarding the exclusion provisions and the deduction percentages can be found in the 'Guide to Legislation, Pay-roll Tax Act 1971'.
For South Australian pay-roll tax purposes the maximum deduction entitlement is $504,000. The deduction entitlement that either a non-group organisation or a group of companies is entitled to is determined by two factors.
1. The number of days that the organisation/group employed Australia wide during the financial year.
2. The portion of taxable wages that were paid in South
Australia compared to their total Australia wide wages.
Non-grouped employers
The deduction entitlement for non-grouped employers is calculated by using the following formula:
Group employers
The Deduction entitlement for group employers is determined with reference to the total South Australian taxable wages of the group and the total Australian taxable wages of the group as if the group is a single employer.
The Designated Group Employer (DGE) claims the deduction entitlement on behalf of the group. In circumstances where the whole deduction entitlement is not used by the DGE, RevenueSA will either apportion the unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group, upon application by the DGE.
The group deduction entitlement is calculated by using the following formula:
Please Note: If there has been a status change throughout the financial year, the deduction entitlement is required to be calculated by applying the appropriate formula for each separate status. The full financial years deduction entitlement is the sum of each status period's deduction entitlement.
However, when a non group employer that employs solely in South Australia (SS) begins to employ in States and/or Territories other than South Australia (SI) or vice a versa the deduction is calculated for the whole financial year, not for each status period.
The Designated Group Employer (DGE) is regarded as the head of the group for South Australian pay-roll tax purposes. It is the responsibility of the DGE to provide specific wage and group structural information as part of the Annual Reconciliation process. By providing this information the DGE benefits from receiving the group deduction entitlement.
For pay-roll tax purposes a group of organisations can be defined as either a South Australian group or an Australia wide group. To be defined as a South Australian group, all the group members must employ solely in South Australia. If these circumstances prevail, the DGE of the South Australian group is allocated a DS status code.
An Australia wide group will have at least one group member employing in South Australia and at least one group member employing in States and/or Territories other than South Australia. If these circumstances prevail, the DGE of the Australia wide group is allocated a DI status code.
The DI status code is allocated to taxpayers that are the Designated Group Employer (DGE) of a group of companies, where at least one member of the group employs in South Australia and at least one member of the group employs in a State and/or Territory other than South Australia.
As the DGE the organisation is regarded as the head of the group for South Australian pay-roll tax purposes and as such is required to provide some extra information for the South Australian Pay-roll Tax Annual Reconciliation. The extra information required by the DGE is: -
Details of group members that employed in Australia during the financial year, the taxable wages the group member paid in South Australian, taxable wages paid in States and/or Territories other than South Australia and the period/s that they were members of the group. This information is to include group members Australia wide.
Estimates of the groups wages payable in South Australia and Interstate on behalf of the group for the next financial year.
As the DGE of a group that has members that employ in States and/or Territories other than South Australia, the group is entitled to a proportional deduction in each State and/or Territory that the group employed. The proportion is based on the percentage of the Australia wide wages the group paid in each jurisdiction.
Please note that if the whole deduction entitlement is not used by the DGE, RevenueSA will either apportion the unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group.
Generally payments made to working or non-working Directors are taxable for South Australian pay-roll tax. Allowances paid to non-working Directors for expenses incurred in carrying out the duties of their Office are not to be included as taxable wages.
The DS status code is allocated to taxpayers that are the Designated Group Employer (DGE) of a group of organisations where all members of the group employ solely in South Australia.
As the DGE, the organisation is regarded as the head of the group for South Australian pay-roll tax purposes and as such are required to provide extra information for the South Australian Pay-roll Tax Annual Reconciliation. The extra information required by the DGE is: -
Wage details of other group members that make up the group.
Estimates of wages on behalf of the group for the next financial year.
Where the group employs solely in South Australia the DGE is entitled to claim the maximum deduction entitlement for the financial year. The only circumstances where the DGE will not be entitled to claim the maximum deduction entitlement is when the DGE either did not employ for the complete financial year or was only the DGE for a portion of the financial year. In these circumstances the deduction entitlement is calculated on a proportional basis depending on the number of days that the employer was the DGE for the group.
If the whole deduction entitlement is not used by the DGE, RevenueSA will either apportion the unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group and upon application by the DGE.
Employer Superannuation Payments
From 1 December 1994, the definition of wages has been extended to include all superannuation benefits.
"Superannuation benefits" means: -
a. a payment of money by an employer on behalf of an employee to a superannuation fund within the meaning of the Occupational Superannuation Standards Act 1987 (Cth)
b. a payment by an employer of a superannuation guarantee charge within the meaning of the Superannuation Guarantee (Administration) Act 1992 (Cth)
c. a payment of money by an employer on behalf of an employee to any other form of superannuation, provident retirement fund or scheme.
Payments made as part of a pre-income tax salary packaging arrangement are to also to be included as taxable wages for South Australian pay-roll tax.
Building Industry Redundancy Scheme Trust (BIRST) payments are taxable as superannuation payments.
The term 'Employer's Wages' refers to the South Australian and/or Interstate wages paid or payable by your organisations.
In the case of Group Employer's the term "Employer's Wages' refers to the South Australian and/or Interstate wages paid or payable by the organisation as a separate entity to the other group member organisations.
As part of the Annual Reconciliation process each individual organisation is required to provide estimated wage details for the new financial year. Depending on the allocated status of your organisation you will be required to provide estimated South Australian wages and estimated Interstate wages for your organisation. If your organisation is the Designated Group Employer (DGE) you will also be required to provide estimated South Australian wages and estimated Interstate wages on behalf of the members of the group.
The estimated wages are used as a basis for calculating the estimated deduction entitlement for your organisation or the group for the new financial year. The estimated deduction entitlement is then to be used in the calculation of pay-roll tax for each periodic return lodged.
For South Australian pay-roll tax purposes the maximum
estimated deduction entitlement is $504,000. The estimated deduction entitlement
that either a non-group organisation or a group of companies is allocated
is determined by the portion of taxable wages that were paid in South
Australia compared to their total Australia wide wages.
Non-grouped employers
The estimated deduction entitlement for non-grouped employers is calculated by using the following formula:
Group employers
The estimated deduction entitlement for group employers is determined with reference to the total South Australian taxable wages of the group and the total Australian taxable wages of the group as if the group is a single employer.
The Designated Group Employer (DGE) is allocated the estimated deduction entitlement on behalf of the group. In circumstances where the whole of the estimated deduction entitlement is not used by the DGE the unused portion of the estimated deduction entitlement should not be allocated to other group members.
At the end of the financial year once the actual deduction entitlement is calculated RevenueSA will either apportion any unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group, upon application by the DGE.
The group estimated deduction entitlement is calculated by using the following formula:
Structural changes affecting the individual organisations grouping status and/or, the organisation/group ceasing or beginning to pays wages in more than one State and/or Territory will alter the estimated deduction entitlement. Accordingly, such structural changes should be reported to RevenueSA in writing.
Where benefits are provided, the amount to be included as taxable wages under the Act is the taxable value of the fringe benefit as determined under the provisions of the Fringe Benefits Tax Assessment Act 1986 (Commonwealth).
Effective from 1 July 2002, the grossed up value of fringe benefits is to be included in the total taxable wages paid by an employer. This figure is obtained from Item 14 of the Fringe Benefit Tax Return.
Where a component of wages is covered by two or more subsections of the wages definition, it should only be included once in the calculation of total taxable wages.
Commonwealth fringe benefits returns are based on an accounting year ending 31 March, and therefore, will differ from those relating to State pay-roll tax returns. Accordingly, the amending Act provides the Commissioner with discretionary power to accept a monthly return in which the value of fringe benefits included is an estimate of those fringe benefits.
The difference between declared and actual benefits provided and estimated amounts declared in returns throughout the year must be declared at the time of the annual reconciliation each financial year.
The GI status code is allocated to taxpayers that are members of a group where at least one of the members of the group during the financial year employed in a State and/or Territory other than South Australia.
Please note that to be a GI status taxpayer it is not necessary for the organisation to employ outside of South Australia as only one related group organisation is required to employ outside of South Australia for the GI status to be relevant.
As a group member that is not the Designated Group Employer (DGE) for South Australian pay-roll tax the GI status organisation is generally not entitled to claim a deduction entitlement for South Australian pay-roll tax. If the DGE's wages do not exceed the group's deduction entitlement then the GI status organisation may be apportioned part of the remaining deduction entitlement at the discretion of RevenueSA. RevenueSA will determine the allocation of unused deduction entitlement once all reconciliations have been completed for the group.
Group member is the term used for all organisations grouped through the grouping provisions of the Pay-roll Tax Act 1971.
Details relating to the grouping provisions can be found in, 'A Guide to Legislation, Pay-roll Tax Act 1971'.
There are two forms of groups that exist in South Australia for pay-roll tax purposes. These are South Australian groups and Australia wide groups.
A South Australian Group will have members that pay wages solely in South Australia. An Australia Wide group will have members that pay wages in South Australia and members that pay wages in States and/or Territories other than South Australia or members that pay wages both in South Australia and other States and/or Territories other than South Australia.
A South Australian group will consist of one DS status taxpayer which is referred to as the Designated Group Employer (DGE) and one or more GS status code taxpayers which are the referred to as the group members.
An Australia Wide group will consist of a DI status code taxpayer which is referred to as the Designated Group Employer (DGE) but may or may not have other group members referred to as GI status code taxpayers registered for South Australian pay-roll tax. Whether the group members pay wages in South Australia will determine whether the group member will be required to be registered for pay-roll tax in South Australia. Although the group member may not be required to register for South Australian pay-roll tax their wage details paid in States and/or Territories other than South Australia are required for the calculation of the group's deduction entitlement. Therefore all members of the group that pay wages in Australia are required to be declared by the DGE as part of the Annual Reconciliation.
The GS status code is allocated to taxpayers that are members of a group where all of the group's members employ solely in South Australia.
As a group member that is not the Designated Group Employer (DGE) for South Australian pay-roll tax the GS status organisation is generally not entitled to claim a deduction entitlement for South Australian pay-roll tax.
If the DGE's wages do not exceed the group's deduction entitlement then the GS status organisation may be apportioned part of the remaining deduction entitlement at the discretion of RevenueSA. RevenueSA will determine the allocation of unused deduction entitlement once all reconciliations have been completed for the group, upon application by the DGE.
The term 'Interstate Wages' refers to any wages deemed taxable in another jurisdiction other than South Australia for pay-roll tax purposes in that particular jurisdiction.
Where the Australian wages do not exceed the threshold of a particular jurisdiction the following is to apply. The wages to be declared as interstate wages are the sum of all the wages paid in the particular jurisdiction that would be taxable pursuant to the Pay-roll Tax Act 1971 (SA) if the wages were paid in South Australia.
The term 'Other Group Member's Wages' refers to the South Australian and/or Interstate wages paid or payable by all other group members that employ in Australia apart from the Designated Group Employer (DGE).
The term 'Payments in Kind' refers to any non-monetary payment of goods and/or services rewarded to an employee for services rendered in their capacity as an employee.
The full monetary value of the goods and/or services, are to be declared as taxable wages.
Salaries and wages are any amounts either paid or payable via monetary payment for services performed by an employee to an employer.
Payment via monetary payment includes payments made by cheque, money order or paid directly to employee's bank account.
The SI status code is allocated to taxpayers that are stand-alone (non-group) organisations that employ in South Australia and in another State and/or Territory other than South Australia.
As a taxpayer that employs in more than one State and/or Territory the SI status taxpayer is entitled to a proportional deduction in each State and/or Territory that they employed. The proportion is based on the percentage of the Australia wide wages the organisation paid in each jurisdiction.
A South Australian Group exists when organisations related through the grouping provisions of the Pay-roll Tax Act 1971 pay wages solely in South Australia.
Details relating to the grouping provisions can be found in, 'A Guide to Legislation, Pay-roll Tax Act 1971'.
A South Australian Group will consist of one DS status code taxpayer which is referred to as the Designated Group Employer (DGE) and one or more GS status code taxpayers which are referred to as the group members.
As the group employs solely in South Australia the DGE is entitled to claim the maximum deduction entitlement for the financial year. The only circumstances where the DGE will not be entitled to claim the maximum deduction entitlement is when the DGE either did not employ for the complete financial year or was only the DGE for a portion of the financial year. In these circumstances the deduction entitlement is calculated on a pro-rata basis depending on the number of days that the DGE was the DGE for the group.
If the whole deduction entitlement is not used by the DGE, RevenueSA will either apportion the unused deduction entitlement to other group members or refund any unused deduction entitlement to the DGE once the Annual Reconciliation is completed for all members of the group upon application by the DGE.
South Australian Taxable Wages
Generally any monetary payment or payment in kind to an employee for services rendered in their capacity as an employee will be included as a component of taxable wages.
For South Australian pay-roll tax purposes taxable wages are broken into the following components and include all salaries and wages, remuneration, commissions, bonuses and allowances, fringe benefits, superannuation payments and payments in kind. Director's fees and payments made to certain contractors caught under the contractor provisions of the Pay-roll Tax Act 1971 are also to be included as taxable wages. Explanations of the individual components that make up South Australian taxable wages can be found by clicking on the component as listed above.
In circumstances where employees provide their services in South Australia and in another jurisdiction or overseas during the financial year, whether the wages are to be included as South Australian taxable wages will be dependant on where the wages are paid or payable and where the work was performed during the financial year. The tables below can be used to determine whether an employee's wages are to be included for South Australian pay-roll tax.
Wages are taxable in South Australia when: -
|
The wages are paid or payable in: |
AND the work is performed: |
|
1. South Australia |
Wholly or partly in South Australia. |
|
2. South Australia |
In two or more jurisdictions other than South Australia. |
|
3. South Australia |
Partly interstate and partly overseas. |
|
4. South Australia |
Overseas and the employee has rendered services in South Australia for the employer within a period of six months prior to rendering services overseas. |
|
5. In another jurisdiction |
Not wholly outside of South Australia or not mainly overseas. |
Wages are not taxable in South Australia when:-
|
The wages are paid or payable in: |
AND the work is performed: |
|
1. South Australia |
Wholly in one other State or Territory. |
|
2. South Australia |
Overseas and the employee has not rendered services in South Australia for the employer within a period of six months prior to rendering services overseas. |
|
3. South Australia |
Wholly outside of South Australia or mainly overseas. |
Further details relating to taxable wages can be found in, 'A Guide to Legislation, Pay-roll Tax Act 1971'.
The SS status code is allocated to taxpayers that are stand-alone (non-group) organisations that employ solely in South Australia.
As a SS status taxpayer the organisation is entitled to claim the maximum deduction entitlement for the financial year. The only circumstances where the SS will not be entitled to claim the maximum deduction entitlement is when the SS taxpayer did not employ for the complete financial year. In these circumstances the deduction entitlement is calculated on a proportional basis depending on the number of days that the organisation employed.
In South Australia an organisations pay-roll tax liability is calculated depending on two aspects of the organisations structure. The relevant aspects of the organisations structure are: -
The individual organisations grouping status. For example whether the organisation is a member of a group of companies or a stand-alone non-group employing entity.
and
Whether the organisation pays wages in more than one State and/or Territory or has members in the same group of companies that pay wages in States and/or Territories other than South Australia.
Currently in South Australia there are six status codes that can apply to a taxpayers registration. These status codes are listed below with an explanation of each.
SS - Single South Australian company that employed in South Australia only and was not a member of a group of companies.
SI - Single company that employed in South Australia and Interstate and was not a member of a group of companies.
DS - Designated Group Employer of a group who is the only group member entitled to claim the Pay-roll tax deduction entitlement where all of the members of the group paid wages in South Australia only
DI - Designated Group Employer of a group who is the only group member entitled to claim the Pay-roll tax deduction entitlement where at least one group member paid wages Interstate.
GS - A member of a South Australian group of companies, who is not the designated group employer and is not entitled to claim the Pay-roll tax deduction on wages paid in South Australia only
GI - A member of an Australia wide group where at least one group member pays wages Interstate, who is not the designated group employer and is not entitled to claim any of the Pay-roll tax deduction
During a financial year an organisation's structure may change. For example, if the organisation ownership changes through a purchase by another organisation or if the organisation begins to pay wages in another State and/or Territory other than South Australia. In both of these examples the organisations status code will alter so that the organisations status code best reflects their current structure.
RevenueSA is not always made aware that an organisation may have undergone structural change and therefore as part of the Annual Reconciliation process RevenueSA requests that taxpayers review their current structure and if required, advise of any changes which may have occurred to their structure by advising of a new status code.
By advising of changes to your structure by amending your status code so that it best fits the structure or structures that your organisation experienced during the financial year, in this way RevenueSA can calculate your South Australian pay-roll tax liability with accuracy. During the financial year it is possible for an organisation to have more than one status code for different periods within the financial year due to ongoing structural changes.
All taxable wages paid or payable to trainees and apprentices in South Australia are subject to South Australian pay-roll tax.
As an incentive to promote youth training and employment in South Australia the State Government initiated the South Australian Pay-roll Tax Rebate Scheme. The Scheme provides an 80% rebate of the pay-roll tax payable upon the taxable wages of trainees/apprentices where the trainees/apprentices employment is consistent with certain eligibility criteria. Details as to the eligibility criteria can be found in Circular 212.
Applications for the Pay-roll Tax Trainee Rebate Scheme are required to be submitted bi-annually. The first application period is 1 July to 31 December and the second application period is 1 January to 30 June. Application forms for each period can be printed from the following link.
Trainee Wages Pay-roll Tax Rebate Scheme Application Form