Payroll tax grouping provisions for trade unions and unions of employers

If your business is a trade union or employers union that employs staff, you may be liable for payroll tax. In certain circumstances, trade unions and unions of employers may be grouped.

A trade union is an organisation of employees that exists for 2 main reasons:

  • mutual aid and protection
  • dealing collectively with employers.

A union of employers is an organisation of employers which aims to protect its members' interests in regards to relations with employees and trade unions.

When grouping provisions apply

Grouping may apply to your union if it conducts a business operation outside of its activities of representing its members.

When grouping provisions do not apply

Your union will not be grouped for payroll tax if its activities solely relate to representing their members in industrial relations matters.

Grouping provisions do not apply in these cases because trade unions and employers unions:

  • are not able to be registered under the Corporations Act 2001 (Cwlth), and are not related corporations
  • cannot be classified as operating a business, provided they do not carry on a commercial activity with other parties for the purpose of making a profit.

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