Training contract commenced between 10 November 2020 and 30 June 2022

Wages paid to apprentices and trainees who commenced a relevant training contract between 10 November 2020 and 30 June 2022 (inclusive), received relief equivalent to a 12 month payroll tax exemption.

Wages paid to these employees did not need to be included in payroll tax calculations. These wages were declared separately in the monthly and annual returns.

What wages were eligible?

Wages paid to the apprentice or trainee during their first 12 months of employment.

Which apprentices/trainees were eligible?

The apprentice/trainee had to commence a relevant training contract between 10 November 2020 and 30 June 2022 (inclusive).

My apprentice/trainee commenced their training contract before 10 November 2020 – are they eligible?

No, the apprentice/trainee had to commence a relevant training contract between 10 November 2020 and 30 June 2022 (inclusive).

An existing employee commenced a training contract – were they eligible?

Existing employees that commenced a training contract between 10 November 2020 and 30 June 2022 (inclusive) were eligible for the exemption.

How does the trainee and apprentice exemption work – how is it calculated?

The trainee and apprentice exemption provided relief for the first 12 months of wages paid to eligible employees who commenced a training contract.

The gross wages paid to employees (salaries and wages, bonuses, allowances, superannuation etc.) in the first 12 months were subject to the exemption and were not included in payroll tax calculations.  The amount paid was separately reported when lodging returns.

For example, in the first year an apprentice is paid $20,000 made up of wages, superannuation and allowances:

The amount of $20,000 was exempt from payroll tax.

Any wages paid to employees in the second and subsequent years are liable to payroll tax and these amounts need to be declared in returns.

What happens after the first 12 months?

After the first 12 months, wages paid to apprentices and trainees became liable for payroll tax and any wages paid  are included in monthly and annual returns.

Were government departments and agencies eligible for the exemption?

Government Departments and attached agencies were not eligible to claim this exemption. These wages were included in payroll tax returns.

What happened when I lodged my monthly payroll tax return?

If you had employees that qualified for the apprentice/trainee exemption, you needed to declare this in the return and account for their wages separately.

These wages were not included in the calculation of the payroll tax liability for the month.

What if an employee has finalised their training contract and remained employed at my organisation?

If an employee has finalised their training contract and is still employed by the same organisation, any wages paid to that employee were no longer eligible for the exemption and were required to be included in the payroll tax calculation.

I had multiple employees on training contracts, how did I determine what amount was exempt?  

The exempt amount is the wages paid to the eligible employees during the payroll tax period (month and/or financial year) during their first 12 months of employment.

For example, Company ABC employed two trainees and one apprentice:

• Trainee one commenced employment and their training contract on 1 December 2020.
• Trainee two commenced employment and their training contract on 15 January 2021.
• Apprentice one commenced employment and their training contract on 5 June 2021.

All three were eligible for an exemption from payroll tax for the wages paid during the first 12 months of their employment. Company ABC was required to advise the wages in their monthly returns as follows:

Company ABC would also be required to advise their wages in their Annual Reconciliations as follows:

2020-21 Annual Reconciliation

2021-22 Annual Reconciliation

Did the exemption apply to apprentices/trainees who worked interstate?

This exemption only applied to apprentices/trainees employed within South Australia. Any apprentice/trainee working elsewhere in Australia needed to declare their wages  according to legislation relevant to that state or territory.

To determine where wages are declared, please see the Nexus Provisions page.

I am an employer who employed apprentices/trainee across a number of states. How did I declare these wages in the annual return?

Wages paid to apprentices/trainees located in South Australia which met the criteria for the exemption were not included in the wages/salaries field. These wages were only included in the separate apprentice/trainee wages section.

Wages paid to apprentices/trainees outside of South Australia needed to be declared in the relevant state or territory according to the legislation relevant to that state or territory. If wages were taxable in the relevant state or territory, then they needed to be included in the interstate wages section of your annual reconciliation.

To determine where wages are declared, please see the Nexus Provisions page.

If apprentices and trainees were employed through a group training organisation, how were the wages declared?

Apprentices and trainees employed through a group training organisation did not need to be included in your payroll tax returns as these were reported by the Group Training organisation.

How did I apply for the exemption?

There was no application process.

Wages paid to eligible apprentices/trainees were declared in monthly returns and annual reconciliation via RevenueSA Online.

What information did I need to provide?

No information needed to be provided, however, evidence (for example the training contract) that supports the validity of the exempt wages needs to be retained for a minimum of 5 years.

Evidence will be required should you be subject to a payroll tax audit in the future.