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New South Wales Unveils Payroll Tax Relief for Businesses Affected by COVID-19

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By: Edward Kowalski, Esq. | 15 Sep 2021

The government of New South Wales, Australia, announced tax relief measures to help businesses impacted by the COVID-19 pandemic. The relief has several components.

Payroll tax deferrals for all businesses. Payers of payroll tax have the option of deferring their payroll tax payments until 7 October 2021. Payroll tax taxpayers are still required to file the 2020/21 annual reconciliation by the due date which has been extended to 7 October 2021. These taxpayers also have the option of deferring their payments for the July and August return periods until 7 October 2021.

After filing their 2021 annual reconciliation, payroll tax taxpayers have the option of paying all of their outstanding liability in full or entering into a new Support Payment Arrangement. The tax payable from 2020/21 annual reconciliation and any monthly liabilities for the July, August, and September 2021 return periods can be included in a 2021 Support Payment Arrangement. The government plans to provide more information on how to establish a 2021 Support Payment Arrangement.

Note that the due dates for any Stimulus Payment Arrangement payments in July 2021 remain unchanged. Likewise, the due dates for any existing instalment plan payments in July 2021 are unchanged.

Payroll tax reduction in 2021/22 for certain businesses. The government also announced a 25% reduction in 2021/22 payroll tax liability for business with total grouped Australian wages of $10 million or less and also experienced a 30% decline in turnover. The payroll tax threshold from 1 July 2021 to 30 June 2022 is $1.2 million with a current payroll tax rate of 4.85%.

Edward Kowalski, Esq., is Manager, Payroll Information Resources, for the American Payroll Association