Payroll tax deductions on contractor payments

If you are required to pay payroll tax on contractor payments where the contractor provided materials and equipment, you may deduct an approved non-labour component from your taxable wages.

You must declare the entire payment (both labour and non-labour components) less any approved deduction as wages.

Use the approved percentages in the table below to work out the non-labour component deduction.

If a profession or trade is not listed, contact Queensland Revenue Office in writing for advice at:

• Queensland Revenue Office
  GPO Box 2248
  BRISBANE  QLD  4001
• or
• payrolltax@treasury.qld.gov.au.

You should also deduct GST before calculating payroll tax.

Type of contractor	Deduction from gross payment
Architects	5%
Blind fitters	25%
Bricklayers	30%
Building supervisors (who provide their own vehicles and inspect more than 6 sites per week)	25%
Cabinet makers, kitchen fitters	30%
Carpenters	25%
Carpet layers	25%
Computer programmers	5%
Draftspersons	5%
Electricians	25%
Engineers	5%
Fencing contractors	25%
Painters (who provide their own paint)	30%
Painters (who do not provide their own paint)	15%
Plumbers	25%
Resilient floor layers, vinyl layers	37%
Roof tilers	25%
Tree fellers	25%
Wall and ceiling plasterers	20%
Wall and floor tilers	25%

For more information, see the following public rulings:

• Contractor deductions (PTA018)
• Contractors—labour and non-labour components (PTA019)
• GST considerations for the calculation of payroll tax liability (PTA008).

Also consider…

• Register for a payroll tax seminar.
• Use our interactive help as a guide to determine whether contractor provisions apply.