Payroll tax is calculated on the difference between the taxable wages paid in WA and the deductible amount to which you are entitled.
At annual reconciliation, you finalise the payroll tax returns to determine the actual deductible amount based on actual wages paid, and you calculate the total payroll tax payable.
A credit or debit amount may arise based on the difference between the estimated deductible amount and the actual deductible amount.
You are not liable for payroll tax if you have total Australian taxable wages of not more than $1 million for the period 1 July 2023 to 30 June 2024 ($83,333 monthly).
You are entitled to a deductible amount if you have total Australian taxable wages of more than $1 million but less than $7.5 million for the period 1 July 2023 to 30 June 2024.
Example
Show moreAn employer pays $1,000,000 in WA and $3,000,000 in South Australia for the whole financial year commencing 1 July 2023.
The employer is entitled to receive a deductable amount as their total Australian taxable wages for the financial year is less than $7.5 million.
1 July 2023 to 30 June 2024
The deductable amount for the full year is calculated as follows:
(annual threshold amount – [(total annual Australian taxable wages – annual threshold amount) x tapering value]) x (total annual WA taxable wages/total annual Australian taxable wages)
($1,000,000 – [($4,000,000 – $1,000,000) x (2/13)]) x ($1,000,000/$4,000,000)
($1,000,000 – [$3,000,000 x (2/13)]) x ($1,000,000/$4,000,000)
($1,000,000 – $461,538) x ($1,000,000/$4,000,000)
$538,462 x ($1,000,000/$4,000,000)
$538,462 x 0.25
= $134,616
The tax payable is calculated as follows:
(total annual WA taxable wages – deductable amount) x rate
$1,000,000 - $134,616) x 5.5%
$865,384 x 5.5%
= $47,596.12
