How is Payroll Tax assessed?
As mentioned above, UNSW owes Payroll Tax unless it proves that an exemption exists. In introducing the Vendor Creation Form, UNSW has looked to simplify the process required for proving a payroll tax exemption and where this exemption will be recorded. As a result UNSW has categorised the Payroll Tax exemptions as follows:
- Up-front exemptions
- Ongoing exemptions
Upfront Payroll Tax exemptions
UNSW will assess all contractors and consultants to determine if they meet one of the following 'up-front' Payroll Tax exemptions:
- Two or more suitably qualified people, perform the work under the contract
- The contractor or consultant is being engaged via a recruitment agency
- The contract is primarily for the provision of goods and/or materials
These questions are asked in the Vendor Creation Form. If the contractor or consultant answer 'Yes' to any of these three exemptions, then a Payroll Tax exemption is met and UNSW is not required to pay Payroll Tax on the engagement.
When these exemptions are selected in the Vendor Creation Form, the contractor or consultant will be required to prove the exemption is valid, by providing further evidence when requested by UNSW.
Ongoing Payroll Tax Exemption
If a contractor or consultant does not meet any of the three up-front exemptions outlined above, then UNSW will look to apply the Ongoing Exemption which requires the contractor or consultant to work less than 90 days in a financial year (ie 1 July to 30 June).
Other Payroll Tax Exemptions
Payroll Tax legislation may provide for some other exemptions not included above. UNSW can review special circumstances to determine if these apply on a case by case basis. Please contact your 'HR Consultant' should you wish to discuss this further.