Payroll tax is calculated using the formula below:


GROSS Taxable South Australian Wages

LESS

Deduction

EQUALS

NET Taxable South Australian Wages

MULTIPLIED BY

Tax Rate

EQUALS

Payroll Tax Payable


This basic formula varies based on group membership and interstate wages.

Tax rates

Current rates


Does not exceed $1.5 million

Nil


Exceeds $1.5 million but not $1.7 million

variable from 0% to 4.95%


Exceeds $1.7 million

4.95%


View previous rates

Which rate should be use?

The rate will be calculated based on the employer’s total Australian wages. If the employer is part of a group, it will be calculated on the group’s total Australian wages.

The actual payroll tax rate that will apply for an employer cannot be finalised until the annual reconciliation process is completed in July each year.

However, to allow employers to lodge and pay monthly payroll tax returns, an estimated payroll tax rate will be determined based on the employer’s estimated annual taxable Australian wages declared at the start of the financial year. RevenueSA Online will calculate the estimated payroll tax rate.

Use the payroll tax calculator to estimate the payroll tax rate.

Differences between the estimated payroll tax rate and actual payroll tax rate will be determined as part of the annual reconciliation process, with any over or under payment of payroll tax being resolved at that time. This will mean that:

  • businesses will be entitled to a refund where the estimated rate is higher than the actual rate for the financial year; but
  • for businesses where the estimated rate is lower than the actual rate for the financial year the business will be required to pay any shortfall as part of the annual reconciliation process.

To ensure that there is not an underpayment of tax at the annual reconciliation, businesses are encouraged to review their individual and total group Australian (if applicable) estimates both at the start of the year and throughout the year to ensure that the appropriate rate is being applied.

What is the deduction?

Employers are entitled to a deduction amount which is subtracted from their wages paid. The maximum deduction available is $600,000 per annum (up to $50,000 per month).

The deduction an employer is entitled to claim may vary according to whether the employer is a member of a group, how much of the financial year the employer (or group) employ and the employer’s (or group’s) interstate wages.

Who claims the deduction entitlement?

Non-Group employers

The employer is able to claim the deduction entitlement.


Group employers

Only the Designated Group Employer (referred to as the DGE) is able to claim the deduction entitlement on behalf of the group.

Employers who are members of a group are not all entitled to a deduction.

However, if the full deduction entitlement has not been claimed by the Designated Group Employer for the financial year, the DGE can request for any unused deduction to be applied to one or more group members during the annual reconciliation process.

RevenueSA must be informed, in writing, whenever there is a change in the group membership. RevenueSA will advise the action to be taken to establish the deduction entitlement of the group.

Find out more about grouping of employers on our Grouping of employers page.

How is the deduction entitlement calculated?

Only employ in South Australia

Employ for full financial year

Employers can claim the full deduction of $600,000 per annum. This will be applied as $50,000 per month.

Employ for part of a financial year

Employers can claim a proportionate amount of the deduction. The deduction amount will be based on the number of days employing in South Australia:

Maximum Deduction

X

No. of Days
Employing in SA*
365**

* Equals the number of days in the relevant financial year of which the employer paid or was liable to pay taxable wages.
** 366 days should be used if a leap year


Employ in South Australia and Interstate

Employ for full financial year

For employers can claim a proportionate amount of the deduction The deduction will be based on the their South Australian wages in relation to their total Australia wide wages, using the formula below:

Taxable South
Australian Wages*
Taxable Australian
Wide Wages*

X

Maximum Deduction

* or group wages

Employ for part of a financial year

Employers can claim a proportionate amount of the deduction. The deduction amount will be based on the number of days employing in South Australia and their South Australian wages in relation to their total Australia wide wages, using the formula below:

Taxable South
Australian Wages*
Taxable Australia
Wide Wages*

X  Maximum Deduction  X

No. of Days
Employing in SA**
365***

* or group wages
* Equals the number of days in the relevant financial year of which the employer paid or was liable to pay taxable wages.
*** 366 days should be used if a leap year


Which state or territory are wages declared?

If an employee performs work only in South Australia, you must declare their wages in South Australia.

For more information on what wages are see our Wages page.

If an employee performs work in more than one state or territory in one month, or the work is performed overseas or offshore, the Nexus Provisions outline where wages should be declared.

Find out which state or territory you need to declare your wages in for payroll tax on our Nexus Provisions page.

For more information on what wages are see our Wages page.

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