Exemptions

Wages paid by certain employers are exempt from payroll tax as provided under Part 4 and Schedule 2 of thePayroll Tax Act 2009. An exemption will generally apply to wages paid by the following types of organisations:

• from 1 July 2009 non-profit organisations having as their sole or dominant purpose a charitable purpose (Note: prior to 1 July 2009, non-profit organisations were required to have wholly charitable purposes);
• religious or public benevolent institutions;
• public hospitals;
• non-profit child care centre and kindergartens;
• non-profit schools or colleges for wages paid to persons providing education at or below (but not above) the secondary level of education; and
• a motion picture production company, being wages paid or payable to a person who is involved in the production of a feature film.  The motion picture production company needs to satisfy the Minister that:
  • the film will be produced wholly or substantially within the state;
  • the production of the film will involve or result in the employment of Australian residents; and
  • the production of the film will result in economic benefits to the State of South Australia.

The above list of exempt employers is not exhaustive.

Employers, who believe that they are exempt from payroll tax, should apply to RevenueSA (except applications by motion picture production companies) for a decision on their exempt status.  Full details relating to the operations of the organisation, as well as a copy of the Constitution of the organisation must be provided.

To apply to RevenueSA for an exemption, the form Application for Exemption from Payroll Tax needs to be completed providing full details relating to the operations of the organisation, as well as a copy of the Constitution of the organisation where one exists.

Further information is available in the Payroll Tax Guide to Legislation.

Payroll Tax Exemption for Wages Paid to Apprentices and Trainees (1 July 2010 to 30 June 2012)

As part of the 2012-13 State Budget, the Government announced that the payroll tax exemption for the wages of eligible apprentices and trainees would be abolished from 1 July 2012. For further information please see Information Circular No: 43.

Between 1 July 2010 and 30 June 2012, wages paid or payable to an apprentice or trainee are exempt in the following circumstances:

• by an approved group training organisation; or
• by an employer if the apprentice or trainee is undertaking training under:
  • a school-based training contract;
  • an initial training contract between the employer and the apprentice or trainee;
  • a training contract entered into prior to 1 July 2010 that is current on that date; or
  • a prescribed training contract, or a training contract of a prescribed class.

Information Circular No: 21 explains the application of the exemption for wages paid to apprentices and trainees and clarifies the elements of the exemption.