Payroll Tax Calculator
Enter annual or monthly taxable wages for each jurisdiction where your group operates. The engine apportions thresholds, evaluates surcharges, and produces an itemised liability breakdown instantly.
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The Definitive Guide to Australian Payroll Tax
Payroll tax is the single largest state-administered levy on employment in Australia. This engine implements the statutory formulas for all eight jurisdictions with exactitude: NSW, VIC, QLD, WA, SA, TAS, ACT, and NT. Every threshold, rate, and surcharge is verified against the administering revenue office, with verification dates published beside every figure.
FY 2026/2027 Payroll Tax Rates by Jurisdiction
The table below consolidates the statutory thresholds, headline rates, regional concessions and surcharges for every Australian state and territory for the financial year ending 30 June 2027. Rates are sourced from each Revenue Office and harmonised against the Payroll Tax Acts in force.
Australian payroll tax is administered state-by-state, but thresholds are assessed against Australia-wide group wages. When an employer pays wages in more than one jurisdiction, each state's tax-free threshold is apportioned proportionally by the ratio of that state's wages to total national wages. This prevents employers from claiming the full threshold in multiple states simultaneously.
The formula applied to every state is:Deduction = BaseThreshold × (State Wages ÷ Total Australian Wages). Taxable wages are then the excess of state wages over this apportioned deduction, multiplied by the state's applicable rate.
Critical nuances apply: Victoria phases out the $1.0M threshold entirely once national group wages exceed $5M (reducing $0.50 for every $1 above $3M); Queensland's deduction diminishes $1 for every $4 above $1.3M (reaching zero at $6.5M — the same point at which its tier-2 rate of 4.95% engages); Western Australia uses a wider $1.0M–$7.5M taper window. Only the Designated Group Employer (DGE) — a single nominated entity within a grouped structure — may claim the threshold; all other group members pay tax from dollar one.
Consider a national employer group with $12,000,000 in Australia-wide wages distributed as: NSW $6,000,000 (50%), VIC $4,000,000 (33.3%), QLD $2,000,000 (16.7%). The group is the Designated Group Employer. Here is how the engine computes liability for each jurisdiction:
- Threshold
- $1,200,000 × 50% = $600,000
- Taxable
- $6,000,000 − $600,000 = $5,400,000
- Rate
- 5.45%
- Tax
- $294,300
- Threshold
- tapered to $0 ($12M > $5M phase-out ceiling)
- Taxable
- $4,000,000 (full)
- Rate
- 4.85% (metro)
- Tax
- $194,000
National wages > $5M → VIC threshold fully phased out
- Threshold
- $0 (fully phased out at $6.5M)
- Taxable
- $2,000,000 (full)
- Rate
- 4.95% (> $6.5M tier)
- Tax
- $99,000
QLD Mental Health Levy: not triggered (national < $10M)
Effective group rate: 4.89%. Note how VIC's $3M–$5M phase-out and QLD's $6.5M deduction collapse both thresholds to $0 for this $12M group — a common scenario where the DGE optimisation is moot because no threshold remains to allocate. The only lever left is the choice of which entity holds the wage base.
State-by-State Deep Dive & Worked Examples
Select a jurisdiction below to review statutory citations, threshold mechanics, worked numeric examples, and the most commonly missed pitfalls.
5.45%
NSW applies a flat 5.45% payroll tax on wages exceeding the apportioned $1.2M annual threshold. The threshold is shared pro-rata across multi-state operations and is only available to the Designated Group Employer.
AU wages $2,000,000 → apportioned threshold $1,200,000 → taxable wages $800,000 → base tax $43,600 → total tax $43,600 (2.18% effective)
Payroll Tax Act 2007 (NSW)
- Forgotten DGE nomination across group entities (lose threshold entirely).
- Excluded contractor payments misclassified (labour-only contracts are taxable).
- The NSW monthly threshold is day-weighted, not a flat twelfth of the annual amount.
4.85% (metro) / 1.2125% (regional)
VIC combines a $1.0M base threshold with a $3M–$5M phase-out taper (reducing $0.50 per $1 of national wages above $3M), regional employer concessions (1.2125%), and two stacked surcharges: the Mental Health & Wellbeing Surcharge (from 1 Jan 2022, ongoing) and the COVID-19 Debt Temporary Surcharge (from 1 Jul 2023, live through 30 June 2033). Both surcharges trigger on AUSTRALIA-wide wages above $10M and $100M, applied to the Victorian share.
AU wages $4,000,000 → apportioned threshold $500,000 → taxable wages $3,500,000 → base tax $169,750 → total tax $169,750 (4.24% effective)
Payroll Tax Act 2007 (Vic)
- Regional concession requires ≥85% of wages paid to regional employees — partial qualification forfeits the full discount.
- Surcharges trigger on AUSTRALIA-wide wages > $10M (not VIC-only), then are apportioned to the Victorian share.
- Phase-out triggers at $3M national group wages and fully phases out at $5M.
4.75% / 4.95% tiered; 3.75% / 3.95% regional
QLD's deduction diminishes $1 for every $4 of national wages above $1.3M (reaching zero at $6.5M), the rate uplifts from 4.75% to 4.95% once national group wages exceed $6.5M, and the QLD Mental Health Levy applies 0.25% above $10M (0.75% additional above $100M) of national wages, apportioned to QLD.
AU wages $4,000,000 → apportioned threshold $625,000 → taxable wages $3,375,000 → base tax $160,313 → total tax $160,313 (4.01% effective)
Payroll Tax Act 1971 (Qld)
- Regional discount requires ≥85% of wages outside the South-East Queensland region.
- Rate uplift threshold ($6.5M) uses national group wages, not QLD wages — and equals the deduction phase-out point.
- QLD Mental Health Levy (0.25%/0.75%) applies above $10M national wages, apportioned to QLD via the wage ratio.
5.50%
WA applies a 5.50% flat rate with a diminishing threshold that tapers linearly to zero as national group wages rise from $1.0M to $7.5M — a wider taper window than VIC.
AU wages $3,000,000 → apportioned threshold $692,308 → taxable wages $2,307,692 → base tax $126,923 → total tax $126,923 (4.23% effective)
Pay-roll Tax Assessment Act 2002 (WA)
- Taper window is wider ($1.0M–$7.5M) than VIC — partial deduction persists longer.
- Mineral resources sector grouping rules can pull related entities into one group.
- WA large-employer rates (reported 6% > $100M, 6.5% > $1.5B) are UNVERIFIED — not implemented.
0–4.95% sliding scale, then 4.95%
SA's $1.5M tax-free threshold and $600K maximum deduction were decoupled in 2019. Between $1.5M and $1.7M of Australian wages a variable rate scales linearly from 0% to 4.95%; above $1.7M a flat 4.95% applies to wages above the apportioned $600K deduction.
AU wages $1,650,000 → apportioned threshold $600,000 → taxable wages $1,050,000 → base tax $38,981 → total tax $38,981 (2.36% effective)
Payroll Tax Act 2009 (SA)
- The $600,000 maximum deduction is decoupled from the $1.5M tax-free threshold — do not treat $1.5M as the deduction.
- The variable rate is determined by total Australian wages, not SA-only wages.
- Effective marginal rate inside the $1.5M–$1.7M band is roughly 27% — budget accordingly.
4.00% then 6.10%
TAS uses a two-tier stepped rate: 4.00% on taxable wages in the $1.25M–$2.0M band, escalating to 6.10% on wages above $2.0M — the second-highest top marginal payroll rate nationally.
AU wages $3,000,000 → apportioned threshold $1,250,000 → taxable wages $1,750,000 → base tax $91,000 → total tax $91,000 (3.03% effective)
Payroll Tax Act 2008 (Tas)
- Stepped rates apply only above threshold — under-threshold wages are tax-free.
- Apprentice/trainee rebate schemes can reduce effective rate.
- Grouping of related Tasmanian businesses frequently missed.
6.75%–8.75% banded (FY 2026/27)
The ACT restructured on 1 July 2026 (Determination DI2026-151). The threshold dropped to $1.75M and the flat 6.85% rate was replaced by banded rates selected by Australia-wide group wages: 6.75% up to $20M, 6.85% to $50M, 7.35% to $100M, 7.85% to $150M, and 8.75% above $150M (with no threshold deduction). The 8.75% top band is now the highest headline rate nationally.
AU wages $1,800,000 → apportioned threshold $1,750,000 → taxable wages $50,000 → base tax $3,375 → total tax $3,375 (0.19% effective)
Payroll Tax Act 2011 (ACT)
- The rate is selected by Australia-wide group wages, not ACT-only wages.
- Above $150M AU wages the 8.75% rate applies with no threshold deduction — the highest national headline rate.
- Universities with an ACT campus are capped at 6.85%.
5.50% (6.50% for AU group wages ≥ $100M)
From 1 July 2025 the NT threshold rose to $2.5M with a $1-for-$2 diminishing taper (nil at $7.5M). From 1 July 2026 a 6.5% rate applies where Australia-wide group wages reach $100M. Apprentice and trainee wages are exempt from 1 July 2025.
AU wages $4,000,000 → apportioned threshold $1,750,000 → taxable wages $2,250,000 → base tax $123,750 → total tax $123,750 (3.09% effective)
Payroll Tax Act 2009 (NT)
- The $2.5M threshold and $1-for-$2 taper apply from FY 2025/26 — older references to a $1.5M flat threshold are out of date.
- The 6.5% large-employer rate is tested at group level — an individual employer below $100M can pay 6.5% if its group exceeds $100M.
- NT returns are due on the 21st of the month, not the 7th.
Frequently Asked Questions
Authoritative answers to the most common payroll tax questions from Australian business owners, bookkeepers, and accountants.
Legal & Compliance
This tool is provided for estimation and educational purposes only. Review our legal documents below before relying on any calculation produced by this engine.