MGS Private · State Tax Services
Payroll Tax Audits,
Objections & Appeals (NSW)
Revenue NSW conducts targeted payroll tax audits — particularly in relation to contractor arrangements, grouping provisions and medical practice structures. MGS Private advises on assessments, prepares objections and manages NCAT proceedings.
Payroll Tax Disputes
Payroll tax audit & dispute in NSW
NSW payroll tax is assessed on wages paid by an employer — including deemed wages under various deeming provisions. Revenue NSW conducts targeted audit programs focused on contractor arrangements, labour hire structures, medical practice/practitioner relationships, and the grouping of related entities.
- Contractor arrangement reviews — whether payments are “wages” under the Payroll Tax Act 2007 (NSW)
- Medical practice / GP contractor arrangement audits — a major area of Revenue NSW focus
- Grouping provisions — whether related entities must be grouped for payroll tax purposes
- Interstate grouping — whether NSW payroll tax applies to wages paid in other states
- Objections to payroll tax assessments within 60 days of the assessment date
- Appeals to NCAT — Administrative and Equal Opportunity Division
- Interest and penalty remission applications
Key Payroll Tax Issues
Most commonly audited areas
Contractor Arrangements
The Payroll Tax Act deems certain contractor payments to be wages where the contractor provides services that are part of the principal’s ordinary and regular business, or under ongoing arrangements. Revenue NSW regularly applies these provisions to reclassify contractors as employees for payroll tax purposes.
Medical Practices
Revenue NSW has conducted a systematic audit program of medical practices engaging practitioners as contractors — applying the service entity and contractor provisions. Objection success depends on the specific contractual arrangements between the practice and each practitioner.
Grouping Provisions
Related entities may be grouped for payroll tax purposes — meaning the combined wages of all grouped entities count toward the threshold. Revenue NSW frequently groups entities that business owners believe to be separate, dramatically increasing the payroll tax liability.
Interstate Nexus
Where an employer pays wages in multiple states, the nexus provisions determine how wages are apportioned between states. Incorrect apportionment can result in double taxation or gaps in coverage.
Received a payroll tax audit or assessment?
Time limits apply. Contact MGS Private urgently through your accountant or lawyer.