QLD Payroll Tax Amnesty
In early February, the QLD Government announced an intended “payroll tax amnesty” for medical centres making payments to General Practitioners. While the amnesty was initially seen as a welcome relief in the aftermath of PTAQ000.6.1 (Relevant contracts – medical centres), the subsequently released detail around eligibility for the amnesty may not be as pleasing. We recommend practices obtain individual legal and accounting advice before registering an expression of interest for the amnesty.
Eligibility
The Queensland Revenue Office website (updated 10 February 2023) and its expression of interest form state that medical practices that successfully apply for the amnesty will not be required to pay payroll tax on payments made to contracted GPs up to 30 June 2025, and for the previous 5 years.
Other eligibility requirements include:
The amnesty is limited to contractor payments made to GPs. For the purposes of the amnesty, a GP is registered as a general practitioner with the Medical Board of Australia.
The amnesty may be available to medical practices that have:
- Not been paying payroll tax on payments to contracted GPs
- been, or currently are, subject to compliance activity in relation to payments to
contracted GPs.
The amnesty is not available to:
- other medical doctors or allied health professionals
- medical practices that are already complying with their payroll tax obligations
- new medical practices
Evolving Terms
We reached out to the Queensland Revenue Office for clarification on some of the amnesty eligibility wording and received communication on 16th February 2023 noting that Government is still deciding the final terms of the amnesty. We advise our clients not to complete an expression of interest or registration application until the terms of the amnesty are finalised and understood.
Proceed With Caution
We are concerned about the current wording of the amnesty and whether agreeing to the amnesty terms is akin to nominating that the medical centre is indeed making taxable payments to contractor GPs, which will in the future be liable for payroll tax. We note that many medical centre entities are structured and operated in a manner where no payments are made from the medical centre to GPs for services. These entities seemingly do not fit the amnesty eligibility criteria and should be cautious in agreeing to criteria that do not reflect their actual conduct and operations.
While it is understandable that many medical centres want relief from the threat of a large payroll tax liability, registering for the amnesty (based on the current detail) may run the risk of the practice unknowingly self-nominating themselves for future payroll tax liabilities once the amnesty period ends. We certainly hope this is not the case and the final terms resolve this concern, however, we suggest a cautious approach to registration in the interim.
Further Advice
We will continue to keep you updated on the evolving terms of the amnesty. For specific concerns please contact kelly@growth-md.com. We also encourage you to obtain further legal and individual accounting advice in relation to your practice arrangements, structure and payroll tax liability risk.