Sinclair Wilson has regional experts for Victorian Payroll Tax changes in Warrnambool

Posted on 05/05/2017 by Mark Robson in Tax & Business Advice

Business owners in Warrnambool and every other Victorian regional centre, are likely to be bristling in anticipation for more detail on the Victorian government’s Payroll Tax announcement in this week’s budget.

For those of you who don’t know, here’s an overview:

  • The payroll tax threshold will increase from $575,000 to $625,000 in just 8 short weeks (July 1) and increase again to $650,000 on 1 July next year.
  • Employers with at least 85% of staff employed in regional areas, will have their payroll tax rate cut by 25%, down to 3.65% from 4.85%.

Business operators are likely to see some small savings as a result of the revised thresholds going forward. It is important to note however, with likely wage increases from July 1 2017, the savings may be absorbed quickly.

However, the real excitement is for those business owners who operate and employ in the country. Even if your payroll is literally sitting on the new $625,000 threshold, a 25% discount on the current 4.85% payroll tax rate, will be a positive outcome.

Not all the details are in yet. Some aspects surrounding which specific areas are to be classed as ‘regional’, and the exact compliance process for identifying which staff are employed in regional areas still needs to be clarified. However, my bet would be that areas such as Warrnambool, Hamilton, Camperdown and Colac would well and truly earn regional status.

Sinclair Wilson clients can rest assured that our expert payroll staff are across the upcoming changes. If you are not a Sinclair Wilson client, but would like to discuss how these payroll tax changes can benefit you, call (03) 5564 0555 to arrange a free consultation in Warrnambool or any of our other South-West Victorian offices.