Businesses that increase the number of employees in NSW could be eligible for a $5,000 payroll tax rebate, under the “Jobs Action Plan” which is designed to give businesses an incentive to employ new workers and expand their enterprises.
To be eligible for the rebate, the new position can be full-time or part-time, where the role is performed mainly in NSW. For part-time employees the rebate will be pro-rated based on NSW FTE (full-time equivalent) hours of employment.
For new jobs created on or after 1st July 2013 the rebate has increased from $4000 to $5000, to be paid in two parts:
- $2000 will be paid at the end of the first year of employment,
- $3000 will be paid at the end of the second year of employment.
Employers are required to register the employment of a person in a new position (within 30 days of their start date) and advise the number of NSW FTE employees immediately before the position was filled.
A position is considered a new job if it results in a sustained increase in the employer’s NSW FTE employees. If employment is only maintained for the first year, then the rebate will only be paid for that year.
If the NSW FTE falls below the level required for payment of the rebate for more than 30 days at any time during the year, the rebate may not be paid. So, basically, you have 30 days to fill a job vacancy during the two year qualification period, before the rebate is at risk.
Additional Payroll Tax Relief
For businesses currently paying payroll tax there has been an increase to the wages threshold. Wages counted towards the threshold include salaries, commissions, bonuses, allowances, superannuation contributions, fringe benefits, termination payments, shares and options contributions. It is estimated that due to the threshold increase around 1300 businesses that would have paid payroll tax this financial year, won’t, and businesses that continue to pay the tax will be more than $3,000 better off.
- Payroll tax threshold for FY11-12 was $689,000
- Payroll tax threshold for FY 12-13 has increased to $750,000
- Payroll tax rate remains the same at 5.45%
For more detail give us a call to discuss, or browse the Jobs Action Plan information online.