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Queensland Government - Queensland Revenue Office
Queensland Government - Queensland Revenue Office

Taxable wages for payroll tax

When you register for payroll tax and lodge returns, you will need to know what wages are taxable.

‘Taxable wages’ are wages paid by an employer for an employee that are taxable in Queensland and not exempt from payroll tax.

Gross salary and wages include annual leave, sick leave and long service leave. This is the total before any deductions (e.g. PAYG, child support) have been applied.

The table below has information on the items you may need to include when calculating your taxable wages.

If identified as taxable, include these payments when calculating your taxable wages.

When you lodge your:

  • periodic return, include items that are taxable as part of your Queensland taxable wages
  • annual return
    • include items that are taxable in the corresponding fields as part of your Queensland taxable wages
    • enter non-taxable and exempt items in the relevant fields as part of your Queensland non-taxable wages.

 

Item Taxable, not taxable or exempt
Accident pay Taxable if you pay:

  • wages for the day of injury
  • an employee is away from work after an accident
  • compensation for a work-related injury where the claim is not approved under the Workers’ Compensation and Rehabilitation Act 2003
Accommodation allowance Taxable for the part of the allowance over the exempt rate if used for overnight accommodation
Adoption leave Exempt (up to 14 weeks)
Allowances Taxable under certain conditions
Annual leave Taxable
Annual leave paid on termination Taxable
Apprentice wages Exempt under certain conditions
Bonuses Taxable
Car parking fringe benefits Not taxable
Charitable institutions Exempt if:

  • registered with our office as a charitable institution
  • wages paid by the institution to persons engaged exclusively in work that meets the qualifying criteria
Clothing allowance Taxable
Commissions Taxable
Community Development Employment Project employees (administered under the Community Development Program) Exempt if wages are paid to an Aboriginal or Torres Strait Islander person employed under this program
Consular staff Exempt
Contractor payments Taxable under certain conditions
Defence force payments Exempt
Directors fees Taxable
Dividends (company share) Not taxable
Domestic and family violence (DFV) leave Taxable
Employment agency personnel Taxable under certain conditions

Where taxable, employment agent pays payroll tax

Entertainment allowance Taxable
First aid allowance Taxable
Fringe benefits Taxable, unless it is a:

  • car parking fringe benefit
  • tax-exempt body entertainment fringe benefit
Genuine redundancy payments Not taxable if exempt from income tax
Gifts Taxable unless not related to employment services
GST Not taxable
Holiday pay Taxable
JobKeeper
  • JobKeeper amount—not taxable
  • Wages paid in excess of JobKeeper amount—taxable
  • JobKeeper superannuation—taxable
Jury service Taxable
Leave loading Taxable
Living away from home allowance Taxable in accordance with the Fringe Benefits Tax Assessment Act 1986 (Cwlth)
Local authorities or councils Exempt unless the wages are being paid in connection with the following activities:

  • abattoirs
  • bakeries
  • cemeteries
  • electricity generation, distribution or supply
  • hostels and hotels
  • milk supply
  • parking stations
  • picture theatres
  • public markets
  • quarries
  • sewerage
  • transport
  • water supply

Wages for other activities will be subject to a payroll tax equivalent

Long service leave Taxable
Make-up pay Taxable
Meal allowance Taxable
Military leave Exempt
Motor vehicle allowance Taxable over the exempt component when you calculate the number of kilometres an employee travels for business purposes in their own car
Non-cash benefits Taxable if they form or are defined as wages
Options Taxable
Overtime Taxable
Overtime meal allowance Taxable
Paid parental leave scheme (funded by Australian Government) Not taxable
Parental leave Exempt (up to 14 weeks)
Pay in lieu of notice Taxable if the employee must include it for income tax purposes
Public hospitals Exempt where the employee performs duties that are usually performed in connection with a public hospital
Queensland Government departments (per s.8 of the Financial Accountability Act 2009) Exempt unless paid by a commercialised business unit included in the list of significant business activities under section 39(4) of the Queensland Competition Authority Act 1997
Queensland hospital and health services (per s.17 of the Hospital and Health Boards Act 2011) Exempt for hospital and health services established under the Hospital and Health Boards Act
Redundancy contributions to Qleave or an approved fund Not taxable, as long as the payment does not constitute a fringe benefit

Approved redundancy funds include:

  • B.E.R.T. (Building Employees Redundancy Trust)
  • B.E.W.T. (Building Employees Welfare Trust)
  • C.I.P.S. (Construction Income Protection Scheme)
Redundancy payments Taxable under certain conditions
Reimbursements Not taxable unless a fringe benefit

An expense payment fringe benefit may arise where an employer:

  • reimburses an employee for expenses incurred by the employee
  • pays a third party for the expenses incurred by the employee

These expenses may be business or private expenses, or both

Relocation allowance Taxable
Salary sacrifice arrangement Taxable

If in exchange for fringe benefits, the fringe benefits’ grossed-up value is taxable. Otherwise, the entire sacrificed amount is taxable

Shares Taxable
Sick leave Taxable
Subcontractors Taxable under certain conditions
Superannuation contributions and superannuation guarantee charge Taxable for an employee or non-employee director
Telephone allowance Taxable
Termination payments Taxable

  • unused annual leave, sick leave, long-service leave, bonus, loading or other additional payments relating to that leave
  • ex gratia payments or ‘golden handshakes’
  • payments in lieu of superannuation
  • payments in lieu of notice
  • income taxable component of approved redundancy or early retirement scheme payments

Exempt

  • invalidity segment of the employment termination payment (ETP)
  • income tax-exempt component of genuine redundancy payments or early retirement scheme payments
  • death benefit segment of an ETP that is income tax exempt
Tool allowance Taxable
Trainee wages Exempt under certain conditions
Uniform allowance Taxable
Union representatives or board members Taxable if:

  • an employer-employee relationship exists between the parties
    or
  • the payments are remuneration to a director or member of the governing body of the union
Volunteer worker leave Exempt for:

  • volunteer members of a rural fire brigade
  • volunteer members of the State Emergency Service
  • honorary ambulance officers
Workers’ compensation payments Not taxable for:

  • compulsory payments insuring against accidental, work-related injuries
  • WorkCover Queensland compensation payments
Workforce retention bonus (residential care and home care) Taxable
Last updated: 27 March 2024