The Act contains provisions that allow for the grouping of employers.
The grouping provisions have the effect of adding together the wages paid by group employers and allowing only the designated group employer to claim the deduction.
See our Rates and Thresholds page for more information on deduction entitlements.
A group will exist where any of the following 4 circumstances applies:
- corporations are related under Section 50 of the Corporations Act 2001 (Cwlth);
- there is an inter-use or sharing of employees between 2 or more businesses;
- the same person has (or 2 or more persons, together, have) a controlling interest in each of 2 or more businesses (where those businesses are carried on by separate legal entities); or\
- an entity (that is, a person or set of associated persons) has a controlling interest in a corporation.
If a person is a member of 2 or more groups, the members of all the groups together constitute a group.
For further information see Information Circular No 4: Payroll Tax Groupings.
It is important to note that where the same person owns 2 or more businesses (that operate under the same Australian Business Number [ABN]), it is not necessary to consider the grouping provisions. In such cases, there is only one employer for payroll tax purposes and the wages paid in respect of each business must be combined in the return lodged by that employer.
Joint and several liability of group members
Any tax (including interest and/or penalty tax) payable under the Act and/or TAA by a member, or members of a group, is a debt due jointly and severally by every group member (employer or not) who was a member of the group during the period in respect of which the liability arose.
Exclusion from a group
The Commissioner has discretion to exclude a member from a group 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 relevant, that a business conducted by that member is carried on independently of, and is not connected with the carrying on of, a business carried on by the any other member of the group.
However, this discretion is not available for a group constituted under Section 50 of the Corporations Act 2001 (Cwlth) other than where a corporate trustee is involved.
See Revenue Ruling PTA031: Commissioner’s Discretion to Exclude from a Group for further information.
To apply for exclusion please complete an Application to Exclude from a Group (PDF 72KB).