Estimate potential Victorian payroll tax based on taxable wages and the relevant threshold, rate and employer circumstances entered in the calculator.
Payroll tax is a state-based tax on wages paid by employers, so the rules differ across Australia. For Victorian employers, the standard payroll tax rate is 4.85% from 1 July 2025 onward, with a lower 1.2125% rate available to eligible regional Victorian employers. The annual payroll tax-free threshold is $1 million, subject to adjustment and phase-out rules.
The threshold can be affected where an employer operates for only part of the year, pays interstate wages or is part of a payroll tax group. From $3 million of total annual taxable Australian wages, the Victorian deduction begins to phase out and is fully removed at $5 million. Larger employers can also be subject to additional Victorian payroll tax surcharges.
Check the Victorian threshold, grouping rules and wage components that can affect payroll tax.
From 1 July 2025, the full annual threshold is $1,000,000 and the monthly threshold is $83,333. The available deduction can be adjusted for interstate wages, part-year employment and the phase-out rules.
The standard Victorian payroll tax rate is 4.85%. Eligible regional Victorian employers can qualify for the lower regional rate of 1.2125%, provided the relevant conditions are satisfied.
Victorian payroll tax can apply to more than ordinary salaries and wages. Taxable wages can include superannuation contributions, fringe benefits, certain contractor payments and some termination payments, subject to exemptions and specific rules.
Related businesses can be grouped for payroll tax purposes. Where grouping applies, the threshold is generally considered at group level rather than separately for each group member, which can materially change the calculation.
Yes. Additional mental health and wellbeing and temporary COVID-19 debt surcharges can apply where Australian wages exceed the relevant large-employer thresholds. The surcharge calculation depends on Victorian taxable wages and the applicable thresholds.
SMH Accountants & Advisors can help review taxable wages, grouping, interstate payroll and registration obligations before the annual reconciliation.
