Staying compliant with tax obligations is crucial to running a successful business in South Australia—and Payroll Tax SA is one area you can’t afford to overlook. For employers with a growing workforce, this state-based tax can have significant implications on your financial planning and HR strategy. Whether you’re a small business approaching the threshold or a large enterprise navigating complex reporting requirements, understanding how SA’s payroll tax works is essential. Let’s break down everything employers need to know to stay on top of their payroll tax responsibilities.
What Is Payroll Tax in South Australia?
Payroll tax is a state tax imposed on wages paid or payable to employees. In South Australia, it’s administered by RevenueSA and applies to businesses whose total Australian taxable wages exceed the prescribed threshold. Unlike income tax, which individuals pay, payroll tax is paid by the employer.
In SA, the payroll tax threshold and rates change periodically, so it’s important for employers to stay updated to ensure compliance.
Current Payroll Tax Rates and Thresholds (As of 2024)
| Annual Taxable Wages | Payroll Tax Rate |
|---|---|
| Up to $1.5 million | 0% |
| $1.5 million – $1.7 million | Variable (marginal) |
| Above $1.7 million | 4.95% |
Note: These thresholds apply on a group basis, meaning related entities must combine their wages when calculating liability.
For the latest rates, always check directly with RevenueSA.
Who Needs to Register for Payroll Tax?
If your total Australian wages exceed the monthly threshold (one-twelfth of the annual threshold), you must register for payroll tax. Even if you expect your wages to increase over the year, early registration helps avoid penalties and ensures proper financial planning.
You need to register if:
- You’re an employer in South Australia
- Your total wages exceed $125,000 per month
- You employ across multiple states and your combined wages exceed state thresholds
What Payments Are Subject to Payroll Tax?
The term “wages” under payroll tax law includes more than just salaries. Here’s a breakdown of taxable payments:
| Included in Payroll Tax | Excluded from Payroll Tax |
|---|---|
| Salaries and wages | Paid parental leave (some exemptions) |
| Bonuses and commissions | Jury duty payments |
| Superannuation contributions | Redundancy payments (in certain cases) |
| Fringe benefits (e.g., vehicles) | Volunteer reimbursements |
| Contractor payments (in some cases) | Distribution to shareholders (non-wage) |
Understanding what counts could save your business thousands in unforeseen tax liabilities.
Grouping Provisions and Payroll Tax
If your business is part of a corporate group, grouping rules apply. That means wages across all entities in the group are aggregated to determine whether you’re over the threshold. This is particularly important for:
- Companies with shared employees
- Entities under common control
- Businesses with common ownership
Failing to declare group relationships can result in significant penalties.
Lodging and Paying Payroll Tax
Once registered, you’ll need to lodge monthly returns, usually by the seventh day of the following month. An annual reconciliation is also due at the end of the financial year to ensure all wages and tax payments match up.
Payments can be made through:
- Direct debit
- BPAY
- Online systems via your RevenueSA account
Ensure all returns are submitted on time to avoid late fees and interest charges.
Tips for Staying Compliant
To make your payroll tax responsibilities stress-free, consider these best practices:
- Keep accurate payroll records (employee wages, super, leave)
- Review your contracts with contractors to determine taxability
- Use payroll software that flags payroll tax liabilities
- Consult with a registered tax advisor or accountant
- Regularly check RevenueSA’s website for updates
Final Thoughts
Payroll Tax SA can be complex, especially as your business grows and employs more staff. But with the right knowledge and tools, compliance doesn’t have to be daunting. Stay informed, plan ahead, and seek expert guidance when needed. A proactive approach to payroll tax not only minimizes your legal risks—it also supports more sustainable, long-term growth for your business.
Sufiyan, a passionate IT professional and finance enthusiast dedicated to simplifying financial clarity for every Australian. With years of experience in both tech and personal finance, Sufiyan oversees all content to ensure accuracy, usability, and relevance.