The Victorian Civil and Administrative Tribunal (the Tribunal) in The Optical Superstore Pty Ltd & Ors v Commissioner of State  VCAT 169 has held that payroll tax was not payable on certain net consultation payments made to optometrists by the owner of the clinic and premises at which that the optometrists used to treat their customers. The case also dealt with the application of de-grouping discretion and penalties and interest on payroll tax liabilities, with the Tribunal finding that the Commissioner was correct in disallowing de-grouping, as well as not allowing the remission of penalties or interest in respect of payroll tax underpayments.
The proceedings were brought before the Tribunal as a result of a challenge by the Applicant against payroll tax assessments issued by the Victorian State Revenue Office in respect of payments made by the Applicant to optometrists who treated customers from the Applicant’s facilities. Under agreement with the optometrists, the Applicant would collect gross consultation fees on the optometrists’ behalf from customers before deducting occupancy fees payable by the optometrists to the Applicant for use of the facilities. The net consultation fees would then be paid to the optometrists.
While finding that the contracts between the Applicant and the optometrists were ‘relevant contracts’, the Tribunal agreed with the Applicant that the net consultation fees paid by the Applicant to the optometrists were generally not wages for payroll tax purposes. This was on the basis that the net consultation fees were effectively held on trust for the optometrists, and the payments were therefore not considered to be for, or in relation to, services provided to the Applicant. Instead, only a small number of payments made by the Applicant to optometrists based directly on hours worked by the optometrists were considered wages for payroll tax purposes.
ATO’s compliance approach to Superannuation Guarantee
The Australian Taxation Office (ATO) has released a fact sheet which explains its compliance and penalty approach in relation to employer superannuation guarantee (SG) obligations. This approach applies to employers who are unable or unwilling to meet their SG obligations, including non-payment, under-payment, or late payment of SG contributions on behalf of an eligible employee.
The guidance indicates that the ATO is unlikely to impose additional penalties for employers who engage with them and have a compliance history that demonstrates general compliance with their superannuation obligations.
Single Touch Payroll ATO update
The ATO has released a Single Touch Payroll communication resource pack, which contains, among other things, detailed information on payments employers should report through Single Touch Payroll and information for employees.
The ATO has also started contacting employers to remind them about the need to start reporting using a Single Touch Payroll-enabled solution from 1 July 2018. This applies to employers with 20 or more employees, unless a deferral is in place. The test date for reporting the number of employees was 1 April 2018.
New Visa - Global Talent Scheme
The Government has announced that a new visa scheme to attract highly skilled global talent and deliver innovation to Australia will be piloted from 1 July 2018, for 12 months. The Global Talent Scheme will consist of two components:
- Established businesses with an annual turnover of more than AUD 4 million will be able to sponsor highly skilled and experienced individuals for positions with earnings above AUD180,000 into Australia.
- Technology-based and Science, Technology, Engineering and Mathematics (STEM)-related start-up businesses will also be able to sponsor experienced people with specialised technology skills.
The Government will consult further on the details of the scheme over the next few months.
Taxable payments reporting system and contractors in courier and cleaning industries
The Treasury Laws Amendment (Black Economy Taskforce Measures No.1) Bill 2018, which is currently before Federal Parliament, seeks to extend the taxable payments reporting system to businesses in the courier and cleaning industries from 1 July 2018. In readiness for this, the ATO has updated its draft guidance on the proposed expansion of the taxable payments reporting system. Comments were due on 23 March 2018.
New payroll tax bill to restrict trainee exemption (WA)
The Pay-roll Tax Assessment Amendment (Exemption for Trainees) Bill 2018 has been introduced into the WA Parliament. The Bill proposes to amend the Pay-roll Tax Assessment Act 2002 (WA) to limit the existing payroll tax exemption to new employees who do not have any previous training contract with an employer’s payroll tax group, and to a particular period for training qualification. The changes seek to close a loophole in the current exemptions with retrospective effect from 1 December 2017, with transitional rules in place for training contracts entered into before that date.