The exemption from payroll tax for wages paid to trainees, provided for in section 41D of the Pay-roll Tax Assessment Act 2002, applies only to eligible new employees who are entitled to a rate of pay for ordinary hours of work of $100,000 per annum or less (‘the threshold amount’).
This revenue ruling sets out the Commissioner's interpretation of the term ‘a rate of pay for ordinary hours of work’ for the purposes of determining if an employee’s pay entitlement exceeds the threshold amount.
This revenue ruling was archived on 30 June 2019. Transitional arrangements apply to continue the exemption for an existing employee whose training contract was lodged for registration under the VET Act prior to 1 December 2017. The exemption continues to apply for the balance of the nominal term of the training contract, subject to the employee’s wages not exceeding the threshold amount at the time their contract was lodged.
