Payroll tax on fees and payments to directors

A company director includes a member of the governing body of your company. The wages paid to directors are liable for payroll tax in Queensland.

As well as salary, directors wages can include:

• superannuation contributions
• shares or options
• employment termination payments
• directors fees
• any other amount paid or payable by a company as remuneration to a working or non-working director of that company.

Directors wages in payroll tax returns

When calculating your taxable wages, include the above payments based on the nexus rules.

When you lodge your:

• periodic return, include these payments as part of your Queensland taxable wages (if taxable in Queensland)
• annual return, enter these payments in the ‘Directors fees’ field in the ‘Queensland taxable wages’ section (if taxable in Queensland). Include payments that are taxable in another state or territory in the ‘Total interstate wages’ field.

Professional partnerships

Partners in a professional practice may be appointed as directors of a client company or a public company. Directors fees paid to these partners must also be included by the client company or public company as wages, even if the:

• partnership (of which the director is a partner) has a partnership agreement that requires any fees received by partners as directors of client companies or public companies to be paid to the partnership
• directors fees are paid to the partnership of which the director is a partner, rather than to the director or partner.

Also consider…

• Learn more about calculating payroll tax.
• Find a list of taxable wages for payroll tax.