Victorian payroll tax surcharge for mental health and wellbeing services

A payroll tax surcharge has been introduced for larger businesses employing staff in Victoria from 1 January 2022 to financially support mental health and wellbeing services in the state.

If your annual Australian taxable wages for payroll tax purposes are greater than $10 million annually, you will be required to pay a payroll tax surcharge in Victoria. This surcharge commences from 1 January 2022 and is to provide support in the Victorian community for mental health and wellbeing services.

Do I need to pay the surcharge?

There are 2 levels when the Victorian payroll tax surcharge kicks in. Firstly, you will meet the first surcharge level when your annual Australian taxable wages are greater than $10 million.

The second level kicks in at $100 million in annual Australian taxable wages.

Grouping does apply to the surcharge. This means that one member of the group will be nominated to pay the payroll tax surcharge on behalf of the group.

How much is the surcharge?

The amount of surcharge payable is:

• 0.5% of your Victorian taxable wages over $10 million annually, and
• a further 0.5% of your Victorian taxable wages over $100 million annually.

Those businesses who employ staff in multiple jurisdictions will have a pro-rata calculation of the surcharge.

When is the surcharge payable?
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The surcharge is payable on lodgement of your Victorian payroll tax returns. For most taxpayers, this is completed on a monthly basis with the State Revenue Office.