41: Master Payroll Tax from Basics to Best Practices

08/26/24 • 21 min

Smarten Up! The Tax and Business Podcast

Are you ready to untangle the web of payroll tax and save your business from costly mistakes? Join us as we break down the essentials every employer needs to know!

In this revealing episode, Sally Preston dives deep into the often confusing world of payroll tax — an essential topic for business owners and managers. Whether you're a startup or running a large enterprise, understanding payroll tax is crucial for staying compliant and avoiding hefty penalties.

In Part 1 of this two-part series, Sally lays the groundwork, covering the basics of payroll tax in Australia, how it’s calculated, and the critical factors that could impact your business across different states and territories. She also offers insights into common pitfalls and the best practices to ensure your payroll tax obligations are met with precision.

In this episode of Smarten Up! The Tax and Business Podcast, you'll learn:

An overview of this two-part series (00:26)
A breakdown of payroll tax’s state-specific nature in Australia and the significance of harmonisation in legislation (00:53)
Understanding payroll tax thresholds and rates, why they vary across states, and what you need to know to stay compliant (03:04)
What counts as taxable wages and the hidden elements that could trip up your payroll tax calculation (04:18)
How to handle payroll tax when your workforce is spread across Australia (06:58)
Key steps for calculating payroll tax, including the importance of determining your total Australia-wide wages (10:25)
What you might be able to exclude and why small business concessions could be a game-changer (14:19)
The risk of audits and penalties — common mistakes businesses make and how to avoid them (17:23)
What to do if you discover an error in your payroll tax (19:35)

From the intricacies of state-specific legislation to the nuanced inclusion of allowances, benefits, and even certain contractor payments, Sally’s expert guidance will help you navigate the complexities of payroll tax with confidence.

If you've ever wondered how to avoid the common mistakes that could trigger a costly audit, or if you simply want to ensure you’re doing things by the book, this episode is a must-listen.

CONNECT WITH SALLY PRESTON

Website: http://www.smartsolutionstax.com.au/
Facebook: https://www.facebook.com/SmartSolutionsTax
Instagram: https://www.instagram.com/smartsolutionsau/
Smarten Up - The Tax and Business Podcast Facebook: https://www.facebook.com/profile.php?id=61555018481517
Smarten Up - The Tax and Business Podcast Instagram: https://www.instagram.com/smarten_up_podcast/
LinkedIn: https://www.linkedin.com/company/smart-solutions-tax-and-business-advisory/

Are you ready to untangle the web of payroll tax and save your business from costly mistakes? Join us as we break down the essentials every employer needs to know!

In this episode of Smarten Up! The Tax and Business Podcast, you'll learn:

An overview of this two-part series (00:26)
A breakdown of payroll tax’s state-specific nature in Australia and the significance of harmonisation in legislation (00:53)
Understanding payroll tax thresholds and rates, why they vary across states, and what you need to know to stay compliant (03:04)
What counts as taxable wages and the hidden elements that could trip up your payroll tax calculation (04:18)
How to handle payroll tax when your workforce is spread across Australia (06:58)
Key steps for calculating payroll tax, including the importance of determining your total Australia-wide wages (10:25)
What you might be able to exclude and why small business concessions could be a game-changer (14:19)
The risk of audits and penalties — common mistakes businesses make and how to avoid them (17:23)
What to do if you discover an error in your payroll tax (19:35)

If you've ever wondered how to avoid the common mistakes that could trigger a costly audit, or if you simply want to ensure you’re doing things by the book, this episode is a must-listen.

CONNECT WITH SALLY PRESTON

Website: http://www.smartsolutionstax.com.au/
Facebook: https://www.facebook.com/SmartSolutionsTax
Instagram: https://www.instagram.com/smartsolutionsau/
Smarten Up - The Tax and Business Podcast Facebook: https://www.facebook.com/profile.php?id=61555018481517
Smarten Up - The Tax and Business Podcast Instagram: https://www.instagram.com/smarten_up_podcast/
LinkedIn: https://www.linkedin.com/company/smart-solutions-tax-and-business-advisory/

Previous Episode

40: How I Survived My First Year in Business

Ready to dive into the nitty-gritty of launching a business?
Join Sally Preston as she unpacks her first year as a business owner, sharing invaluable lessons, mistakes, and insights that could save you both time and money on your entrepreneurial journey.
In this special episode, Sally reflects on the first 12 months of running her own accounting firm. From the challenges of choosing the perfect business structure and name to the unexpected hurdles of onboarding software and staff, she reveals the ups and downs of starting a business in the tax and accounting world.
Whether you're a seasoned entrepreneur or just starting out, Sally’s candid advice on avoiding common pitfalls and the importance of flexibility could be the key to your success. Plus, she offers practical tips on branding, client management, and financial planning that every business owner needs to hear.
In this episode of Smarten Up! The Tax and Business Podcast, you'll learn:

Sally’s motivation and initial steps leading to the birth of Smart Solutions (01:15)
Why choose a discretionary trust and company structure, and how it can benefit your business (03:40)
The struggles and strategies behind selecting an impactful and future-proof business name 05:20)
How to leverage online tools to create a distinctive brand without breaking the bank (07:10)
The importance of integrated software solutions and why cybersecurity was a top priority (10:05)
The importance of hiring the right team early on (13:00)
Sally shares how she bootstrapped her business, what she invested in, and when she finally paid herself (15:45)
The necessity of being flexible with plans and learning to adapt in a constantly changing business landscape (18:30)
Why not every client is a good fit and the value of focusing on ideal clients (22:25)
The importance of healthy scepticism and aligning with the right people (24:01)

As Sally celebrates one year of Smart Solutions, she leaves listeners with the reminder that it’s okay to make mistakes in business — as long as you learn from them. Whether you’re in your first year or your tenth, her journey is full of actionable insights that can help guide your path to success. CONNECT WITH SALLY PRESTON
Website: http://www.smartsolutionstax.com.au/

Facebook: https://www.facebook.com/SmartSolutionsTax

Instagram: https://www.instagram.com/smartsolutionsau/

Smarten Up - The Tax and Business Podcast Facebook: https://www.facebook.com/profile.php?id=61555018481517

Smarten Up - The Tax and Business Podcast Instagram: https://www.instagram.com/smarten_up_podcast/

LinkedIn: https://www.linkedin.com/company/smart-solutions-tax-and-business-advisory/

Next Episode

42: Master Payroll Tax from Basics to Best Practices Part 2

Are you underestimating your payroll tax liabilities? Discover the hidden traps in payroll tax grouping and contractor provisions that could cost your business big time.

In Part 2 of this two-part series, Sally Preston dives into the complexities of payroll tax that often trip up employers across Australia. Building on the foundations laid in Part 1, this episode unpacks two notoriously tricky areas: payroll tax grouping and contractor provisions.

Sally reveals how seemingly simple business arrangements can lead to unexpected tax liabilities and highlights the common pitfalls that could put your business at risk. Whether you’re a startup or a large enterprise, this episode is a must-listen to ensure you’re not caught off guard by the intricacies of payroll tax law.

In this episode of Smarten Up! The Tax and Business Podcast, you'll learn:

An overview of this episode’s topics and a recap of Part 1 (00:11)
How businesses can unintentionally be grouped for payroll tax purposes, and why this matters for your bottom line (02:41)
Examples of how employees working across multiple businesses can trigger unexpected grouping (06:07)
Ways in which controlling interest in different entities can lead to payroll tax grouping (07:46)
The complexities of tracing corporate interests and how they can create larger, unexpected payroll tax groups (09:45)
The financial implications of grouping and how it affects your payroll tax liabilities (11:15)
The intricacies of contractor provisions and the steps to determine if a contractor is actually an employee for payroll tax purposes (13:08)
What constitutes a "relevant contract" and how it impacts payroll tax (13:56)
Key exemptions that could save your business from unnecessary payroll tax (19:05)
Actionable advice on assessing your payroll tax obligations and when to seek expert help (23:32)

Payroll tax can be a minefield, especially when it comes to grouping and contractor provisions. Don’t let these complexities catch you off guard. Take the time to understand your obligations, and when in doubt, always consult with an expert.

CONNECT WITH SALLY PRESTON