Business tax and employer obligations

Coronavirus (COVID-19): Tax obligations

Your tax obligations may have changed due to COVID-19, including if you have received financial relief from the government.

Read about how JobKeeper payments and other financial relief measures may affect your tax this year.

Managing your tax affairs and obligations as an employer is an integral part of your business. Your business's tax obligations and entitlements will vary according to the type of work you do, the number of staff you employ and the kind of benefits you offer. Operating a business as a sole trader, company or a trust will have different tax implications, and it's important to consider these when you are choosing the best legal structure for your business.

Below are some key things to consider when managing your tax affairs and employer obligations.

Australian business number (ABN)

Consider getting an ABN for your business. An ABN helps to manage your tax and business obligations, and is used as a reference by the Australian Taxation Office (ATO) for your business. You will also use your ABN when dealing with other businesses and government departments.

Learn more about applying for and managing an ABN.

Goods and services tax (GST)

GST is a broad-based tax of 10% imposed on most goods, services and other items sold in Australia. Depending on your turnover or service, you may need to register for GST.

Learn more about how GST works.

Business activity statement (BAS)

You must lodge activity statements with the ATO to report and pay your tax. You may do this online through the ATO Online services for business. The service also allows you to manage your business's tax online.

Learn more about business activity statements.

Pay as you go (PAYG)

PAYG is a system that allows you to pay an expected tax liability in instalments. The ATO will notify you of your PAYG obligations.

Learn more about PAYG, including your responsibilities as an employer.

Fringe benefits tax (FBT)

If you (or a person on your behalf) provide certain benefits to your employees or to people associated with your employees, you may be liable for FBT. If so, you must register for FBT with the ATO, and lodge a return each year.

Learn more about fringe benefits tax.

Tax obligations for paying staff

As an employer, you must be aware of your tax obligations when paying staff, including pay as you go, withholding tax and superannuation. Depending on the size of your business, you may also need to pay payroll tax.

The ATO provides essential tax information for employers regarding paying staff, including:

  • tax rates
  • paying superannuation
  • employee termination payments
  • redundancy pay
  • paying contractors.

Forms for both employees and employers, and calculators and tools are provided on the website to help you make sure you withhold the correct amount of tax.

Payroll tax

If you are an employer who pays taxable wages in Queensland, you must register for payroll tax when you:

  • pay more than $21,153 a week in Australian taxable wages
  • or
  • become a member of a group that pays more than $21,153 a week in Australian taxable wages.

You are liable to pay payroll tax when your annual Australian taxable wages are $1.1 million or more. You must register for payroll tax if you exceed the weekly threshold, even if you think that you will pay less than $1.1 million in Australian wages in a year.

Learn more about registering for payroll tax.

Superannuation guarantee obligations

As an employer, you can either pay a set minimum level of superannuation for each of your eligible employees, or pay a charge to the ATO.

Read the ATOs guide to super for employers.

For small businesses with 19 or fewer employees, the ATOs Small Business Superannuation Clearing House is a free online superannuation payments service that helps small businesses meet their superannuation obligations.

Small business newsroom

The ATOs small business newsroom helps you keep up to date with the latest tax and super news. The newsroom features short, easy to read articles on:

  • tax and super changes
  • helpful products and services
  • handy tips and reminders.

Newsroom subscribers receive an email update with the latest headlines every few weeks.

Subscribe and learn more about the small business newsroom.

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