Who must pay Victorian payroll tax when threshold met?
The applicability test for Pay Victorian payroll tax when threshold met (SRO Victoria), computed across 35 industries, 9 business structures and 6 size bands.
Short answer: Some businesses
Applies when the business has payroll tax VIC. Where the business has payroll maybe VIC, check whether your annual Australian wages (grouped) exceed $1M.
What the obligation is
VIC: 4.85% on Australian wages above the $1 million tax-free threshold (FY2026-27).
Victoria payroll tax under the Payroll Tax Act 2007 (Vic). FY2026-27: tax-free threshold $1 million a year (monthly: $83,333). 4.85% standard rate; eligible regional employers pay 1.2125%. Full threshold below $3M of Australian wages; between $3M and $5M it phases out at 50% of wages over $3M; no threshold above $5M. Above $10M Australian wages: mental health and wellbeing surcharge 0.5% + COVID-19 debt surcharge 0.5%; above $100M a further 0.5% each (2% total). Group employer rules aggregate wages across related entities. Returns lodged monthly via SRO online.
The applicability test
Applies when the business has payroll tax VIC. Where the business has payroll maybe VIC, check whether your annual Australian wages (grouped) exceed $1M.
How the regulator frames it: Employers paying Australian wages above the Vic threshold (taking into account grouping).
What triggers it: Wages above the monthly/annual threshold; grouping.
Threshold: Annual Australian taxable wages (grouped) above $1M (FY2026-27)
Jurisdiction: Victoria law only. A business with no operations in VIC is outside it, whatever the rest of the test says.
Which industries are in or out
Outcome across the 35 industries Rules Mate maps (35 of 35: depends on size or structure).
The answer is the same in every industry: depends on size or structure. Industry does not change who must comply.
Business structure and size
Structure does not change the answer across all industries: for every structure the answer is "depends on size or structure".
| Size band | Answer across all industries, any structure |
|---|---|
| No employees (turnover $100K–$1M) | No |
| 1–5 employees (turnover $100K–$1M) | No |
| 6–19 employees (turnover $1M–$3M) | Only if a further fact applies |
| 20–99 employees (turnover $3M–$10M) | Only if a further fact applies |
| 100–499 employees (turnover $10M–$100M) | Yes |
| 500+ employees (turnover $100M–$1B) | Yes |
Worked examples
Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:
- Pty Ltd company in real estate agents with 100–499 employees, turnover $10M–$100M: applies. 100–499 employees — wages far exceed the VIC payroll tax threshold of $1M.
- Pty Ltd company in real estate agents with 1–5 employees, turnover $100K–$1M: does not apply. Requires payroll tax VIC.
- Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: check whether it applies. applies only if your annual Australian wages (grouped) exceed $1M.
- Pty Ltd company in real estate agents with no employees, turnover $100K–$1M: does not apply. Requires payroll tax VIC.
When you need to check further
The engine shows this obligation as "check whether this applies" when a business has payroll maybe VIC. It then applies only if your annual Australian wages (grouped) exceed $1M. That fact is not something Rules Mate can infer from industry, structure or size.
What you must do, and when
- When due
- Monthly by the 7th of the following month; annual reconciliation by 21 July.
- Frequency
- Monthly
- Evidence to keep
- Monthly returns via SRO Vic, wage records, group nomination documents.
- Status
- Current
- Priority
- High
Penalty for not complying
Maximum penalty: Tax shortfall + interest + penalty tax up to 75% for serious non-compliance.
Audit or assurance level
Self-assessment. Authority: Superannuation Guarantee (Administration) Act 1992 (as amended by Payday Super); ATO 'About Payday Super'.
Frequency: Payday Super: contributions must reach the fund within 7 business days of each payday (from 1 Jul 2026). Payroll tax: monthly or annual state and territory returns.
Who can perform it: The employer self-assesses. No mandated independent audit; the ATO and state revenue offices audit at their discretion, so your payroll records are the evidence.
Enforcement examples
What usually applies alongside it
Across the 1,890 business profiles Rules Mate evaluates, these obligations apply to most of the businesses this one applies to, and are far more common among them than among businesses generally:
- Pay ACT payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
- Pay NSW payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
- Pay Northern Territory payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
- Pay Queensland payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
- Pay South Australian payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
- Pay Tasmanian payroll tax when threshold met: applies to 100% of the same businesses (3.0× the overall rate)
Where it sits in the corpus
Rules Mate tracks 37 published obligations tagged "tax", 6 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 7 of those apply outright. This obligation is rated high priority, and is a monthly obligation.
Regulator, legislation and tools
Regulated by State Revenue Office Victoria.
SRO Victoria: Victorian state revenue — payroll tax, land tax, duties, windfall gains tax.
Payroll Tax Act 2007 (Vic): 2125% regional), threshold phase-out between $3M and $5M, mental health and COVID-19 debt surcharges above $10M, grouping framework.
Free tools that help with this obligation:
Questions
- Who must pay Victorian payroll tax when threshold met?
- Applies when the business has payroll tax VIC. Where the business has payroll maybe VIC, check whether your annual Australian wages (grouped) exceed $1M.
- Do sole traders need to pay Victorian payroll tax when threshold met?
- Depends on size or structure. Across every industry and every size band, the engine's answer for a sole trader is: depends on size or structure.
- Do businesses with 1–5 employees need to pay Victorian payroll tax when threshold met?
- No (1–5 employees, turnover $100K–$1M).
- When is "Pay Victorian payroll tax when threshold met" due?
- Monthly by the 7th of the following month; annual reconciliation by 21 July.
Related
Sources
Computed by the Rules Mate applicability engine from the published obligation corpus; facts last checked 3 October 2026. Rules Mate is not a law firm and this is general information, not legal advice. Confirm your position with the regulator source or a qualified adviser before acting.