From 1 December exemption applies to:
- Payments made to contracted general practitioners (GP’s)
- Wages paid to employed GP’s including registrars (and where the registrar is employed by a medical practices as medical practitioners undertaking a placement in general practice approved by organisations such as Royal Australian College of General Practitioners (RACGP) and the Australian College of Rural and Remote Medicine (ACRRM).
- Certain prescribed medical practitioners
Queensland payroll tax represents an important tax liability that may apply to many businesses operating in Queensland (QLD) and should be considered by all health practitioner businesses.
In the current year ending 30 June 2025, the QLD payroll tax threshold is $1,300,000.
- From 1 July 2024, wages in excess of $1,300,000 but below $6,500,000, the QLD payroll tax rate is 4.75%.
- From 1 July 2024, wages in excess of $6,500,000, the QLD payroll tax rate is 4.95%.
- For a business with taxable wages of a business is $2.2million, the QLD payroll tax liability of a business is $42,750.
- Regional QLD business are eligible to a 1% discount on the QLD payroll tax rate.
- A mental health levy of 0.25% may also be payable on Australian taxable wages over $10 million,
In recent years, there have been certain changes to QLD payroll tax policy involving general practice medical centres, QRO audits have collected QRO payroll tax given the Thomas and Naaz Pty Ltd cases and there has been some uncertainty as to the nature of QRO payroll tax liabilities in certain health businesses. In February 2023, the Queensland Government announced it would provide a payroll tax amnesty in relation to payments made to contracted General Practitioners until 30 June 2025.
As part of the Liberal National Party State election commitments in November 2024, significant changes were announced in relation to QLD payroll tax and wages paid by medical practices to General Practitioners.
From 1 December 2024, a new QLD payroll tax exemption was introduced, ensuring that wages paid or payable by medical practices to General Practitioners are not subject to payroll tax or the mental health levy (under section 14(2) of the Payroll Tax Act 1971 (Qld)).
The Qld payroll tax exemption will apply to relevant wages paid or payable from 1 December 2024 onwards.
A General Practitioner is a person registered under the Health Practitioner Regulation National Law to practice in the medical profession in the specialty of general practice (section 14(9) of the Act)
Medical practice means an entity, other than a hospital carrying on a business provided by a General Practitioner.
Importantly, registrars and employer doctors are also exempt from this payroll tax, providing significant relief to these groups.
Under the 2024 Qld changes to payroll tax, the above payroll tax exemption is offered solely to General Practitioner medical practices in QLD from 1 December 2024 and not other related businesses who utilized medical practitioners or dentists.
Given the above recent changes to QLD payroll, and the recommencement of QRO payroll audits in 2025 to other types of medical practices, we recommend you contact our firm to discuss a review of the QLD payroll tax obligations of your business.
For further assistance, please reach out to Brett Young, our Tax Director, at byoung@prosperity.com.au.