Are you a medical practice in Queensland who has not been paying payroll tax on your payments to contracted GPs? If so, you may be eligible to apply for the recently announced Queensland Payroll Tax Amnesty.
Following the December 2022 QRO ruling, the Queensland Government announced a payroll tax amnesty would be applicable to medical centres making payments to General Practitioners (GPs). Now, any relief from the obligation to pay payroll tax is unsurprisingly welcomed by medical practices. However, the eligibility criteria for the amnesty limits the amount of medical centres who will benefit. So...who is eligible, and what exactly for?
What is the Amnesty?
If your Practice is successful, you will not have to pay payroll tax on 'payments made to contracted GPs up to 30 June 2025 and for the previous 5 years (i.e. 2018-25)'. 1
WHO IS ELIGIBLE?
According to the QRO website (as of 2 March 2023), "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."
And is not available to:
- "Other medical doctors or allied health professionals."
- Medical practices that are already complying with payroll tax obligations
- New Medical Practices
- Non-Medical Businesses that are currently paying payroll tax on contractor payments." 2
This means that if you are just starting out as a medical practice, you need to pay payroll tax on your payments to contractors and are not eligible for this amnesty. You can find out more about that here.
Similarly, if you are already complying, this amnesty does not change your position, and you must continue to pay payroll tax to contracted GPs.
WHY ARE THEY DOING THIS?
The Queensland Government is doing this in response to the lack of awareness across the community that medical practices are liable to pay payroll tax on contracted general practitioners (GPs).
THE 'GREY' AREA AND WHAT TO DO?
Currently, it is unclear whether or not agreeing to the amnesty represents you inadvertently stating that your medical practice is making taxable payments to contractor GPs, which may have future implications post-2025. Depending on your exact arrangement, you may fall outside of the contractor provisions (i.e. you don't want to be swept under the rug if you don't have to be). Therefore, we don't recommend rushing to register.
There are more details that will become available soon. Industry experts have noted that the exact terms of the amnesty are still being finalised. Therefore, we recommend pressing pause and not expressing your interest or registering until the Government has finalised these terms. It is important, regardless of this amnesty, to be ahead of the game when it comes to your practice's arrangements and the subsequent risk of payroll tax liability that you may be exposed to, so we recommend obtaining legal and accounting advice.
I DEFINITELY AM ELIGIBLE, AND I DEFINITELY WANT TO APPLY. CAN I DO IT NOW?
Prior to 30 June 2023, you can submit your expression of interest via the form on the QRO website. You will then be contacted about the next steps. However, as emphasised above, we recommend your first step to be seeking legal and accounting advice tailored to your practice before registering such interest.