Apprentice and trainee rebate for payroll tax

The wages you pay to apprentices and trainees are generally exempt from payroll tax.

As an employer of exempt apprentices and trainees, you can also claim a payroll tax rebate that reduces your periodic liability. This rebate is available from 1 July for these financial years:

  • 2009-10 to 2011-12
  • 2015-16 to 2017-18.

For the 2016-17 financial year, the rebate increased from 25% to 50%.

The rebate is automatically calculated when you lodge a return in OSRconnect.

For 2016-17, you can work out the rebate by multiplying 50% of the total wages paid to apprentices and trainees by 4.75% (payroll tax rate) for each return period in the applicable financial years.


An employer paid $50,000 in exempt apprentice/trainee wages for a monthly periodic return.

Initial payroll tax periodic liability (on all taxable wages) $10,000.00
Less incentive rebate ($50,000 × 50%) × 4.75% $1,187.50
Payroll tax periodic liability $8,812.50

The rebate reduced the employer's monthly periodic liability by $1,187.50.

The maximum rebate you can claim is equal to the amount of your periodic liability.

All rebate records must be kept for 5 years.