NSW payroll tax situation unclear one week out

The RACGP and AMA NSW are at odds on calling for an extension to payroll tax amnesty provisions in the populous state.

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GPs in NSW say they are desperate for more detail on how to avoid running afoul of new payroll tax rules, which are slated to begin in just seven working days.

The RACGP is calling for a last-minute extension to amnesty provisions to give doctors and practices additional respite, but the state AMA has refused to join in.

According to the college, its request for an extension to the amnesty has been declined.

Under a plan announced in June, the state government is introducing a bulk-billing support initiative that will give a payroll tax rebate for contractor GP wages at clinics with bulk-billing rates above 80% in metropolitan Sydney and above 70% elsewhere in the state.

The government has also committed to a full retrospective waiver for past unpaid payroll tax liabilities, meaning all clinics are starting with a clean slate.

It’s set to kick in on Wednesday 4 September.

“Practices still don’t know whether they’re classified as being in Sydney or out of Sydney,” RACGP NSW chair Dr Rebekah Hoffman told The Medical Republic.

“They don’t know if their billing rates need to hit 70% or 80% – we don’t even know what’s included in the income for that 70% or 80%.

“It’s all a bit of a mess.”

A full list of which suburbs are included in metropolitan Sydney is published on the Revenue NSW site.

The same webpage also features a flowchart graphic to assist practices and tenant doctors with working out their liability and whether they are eligible for the rebate.

Finance Minister Courtney Houssos told TMR that getting cost of living relief into the hands of patients within the timeline it had committed to was a high priority for the Minns government.

“We have made the new GP payroll tax rebate as simple as possible for GPs,” a NSW government spokesman said.

“The thresholds, rules and timelines were announced in June. 

“Clinics have until 30 June each year to meet the annual bulk-billing payroll tax rebate.

“We thank the RACGP and the AMA for their active participation in Revenue NSW’s payroll tax working group since July. 

“GP clinics can find guidance about the payroll tax waiver and ongoing rebate by clicking the links on the front page of the Revenue NSW website.”

It’s not the first time GPs have been left with questions on payroll tax as deadlines loom.

The payroll tax amnesty in South Australia expired in July, but granular details on the regulations are still pending the passage of legislation.

“We have had around three months to prepare – or three months of knowing we would have to pay payroll tax – but we don’t have the specific details about how much we need to pay, whether we need to put fees up or whether it includes our DVA and WorkCover patients,” Dr Hoffman said.

Dr Hoffman said the college had been meeting with Revenue NSW regularly and feeding through questions from members, but still did not have enough information.

“For some businesses, we’re talking $100,000 worth of tax that could be due next quarter,” she said.

“That’s not an easy sum to have to work out whether or not that’s going to be due – but the tax office isn’t going to say, ‘it’s okay, you don’t have to pay it because you didn’t know’, they’re going to say, ‘it’s due and you have to pay it now’.

“GPs are worried that they’re going to end up with these really big tax debts and we can’t work out how much it’s going to be.”

But other advocacy groups aren’t certain that a further extension to the amnesty is the right call.

“AMA NSW does not support calls to delay the implementation of changes to payroll tax for GPs,” AMA NSW CEO Fiona Davies told TMR.

“AMA NSW ensured that the exemption and the availability of the bulk-billing rebate were made in addition to, and not in place of, the current arrangements for general practitioners.”

This story will be updated with Revenue NSW comment.