Payroll tax, Commonwealth tax and employment law apply distinct tests to contractor arrangements.
Overview
Medical practitioner arrangements may need separate analysis under state payroll tax law, Commonwealth tax law and employment law. State revenue authorities, the Australian Taxation Office, the Fair Work Ombudsman and the courts have different roles and apply tests drawn from their respective legislation.
Details
The three principal regimes are:
- 1State revenue authorities - administer payroll tax under each state's legislation, including relevant contract provisions
- 2Australian Taxation Office - administers Commonwealth tax and superannuation laws
- 3Fair Work Ombudsman and the courts - the Fair Work Ombudsman provides guidance and enforces the Fair Work Act, while courts determine employment classification disputes and remedies
Each regime applies its own statutory tests. The same arrangement can therefore be characterised differently for different legal purposes, and a review in one regime may raise questions under another. Advice should address the contract terms, actual conduct and flow of funds under each applicable law.
Every matter turns on its own facts and we do not guarantee any particular outcome.