Managing payroll is not just about paying your employees on time. It is also about fulfilling your tax obligations and being compliant with your payroll practices. Tax must be paid accurately and on time. Many businesses may fail to lodge returns and make payments on time because of missing due dates.
Payroll tax is a state-based tax in Australia, administered by each state, with varying rules. It is essential to be aware of the due dates for lodging returns and paying your tax accordingly. Missing the payroll tax due dates may lead to penalties, interest charges, or even a compliance audit. Therefore, it is important to be mindful of due dates and fulfil your tax responsibilities properly to stay compliant.
Handling payroll tax properly by lodging returns and paying tax on time will help your company stay compliant. The more compliant the company is, the safer it is. Payroll tax is a legal obligation under each state/territory’s revenue laws. These obligations should be fulfilled accurately and on time to stay compliant with the law. Regular delays or non-lodgement can result in compliance audits, legal notices, and even prosecution in extreme cases. Keeping track of due dates helps your organisation avoid any penalties, interest charges, and legal consequences.
Penalties apply when legal obligations are not met. State revenue offices impose significant penalties for late lodgement or payment, ranging from 25% to 75%, depending on the severity of the non-compliance and individual state regulations.
On the other hand, you are charged interest as a means of compensating the government for the delay in receiving the funds. Interest accrues daily on any unpaid tax until full payment is made. Sometimes it may be remitted or reduced, depending on your compliance history.
Such careless and repetitive compliance issues can lead your company to audits, and this will strain the HR and Payroll teams. These will be time-consuming investigations that may also demand additional and excessive documentation. On the other hand, being mindful helps you avoid unnecessary costs for fines and penalties. Having a good compliance history and interaction with the revenue office can improve the relationship between the business and the regulators. This will be helpful in any situation where your company is in trouble.
In Australia, employers who are registered for payroll tax must lodge a return every month. Employers must lodge returns monthly, except in June, which is covered in the annual reconciliation.
Tax payments and lodging returns may be made on the following business day if the deadline falls on a weekend or public holiday. Additionally, employers will be notified of any additional date extensions that may occur in particular months. Since there may be differences in due dates as per the state, it's vital to double-check the lodgment calendar for your state.
An annual return should be lodged at the end of the financial year by all registered employers in Australia. Even if you’ve been lodging monthly returns throughout the year, you’re still required to complete an annual reconciliation at the end of the financial year. The annual reconciliation plays a key role in helping employers confirm that their payroll tax has been calculated, reported, and paid correctly throughout the year. It provides an opportunity to identify and fix any underpayments, overpayments, or other errors, ensuring that reported wages align with actual figures and reflect any necessary adjustments.
In Australia, if a due date falls on a weekend or public holiday, you are allowed to lodge and pay tax on the next business day, just as in the monthly return. There’s no need to lodge a separate monthly return for June as it will be included in the annual reconciliation. However, in the Northern Territory, employers are required to submit both the June return and the annual reconciliation.
Automate Calendar Alerts
Most cloud-based payroll or HRIS platforms allow you to create calendar reminders. Set up recurring monthly and annual alerts to notify you a few days before each due date. Additionally, there are other tools like
Build a simple checklist into your payroll cycle that includes:
Don’t wait until June to reconcile your books. Mid-year reviews (around December or January) help identify:
Maintain a centralised compliance calendar with all key dates for payroll tax, BAS, super, and other obligations. Share it with relevant team members. If you operate in multiple states, consider creating a consolidated compliance calendar that includes:
Keeping up with payroll tax due dates is important and crucial. Missing a deadline can lead to penalties, interest, and unnecessary stress. But the good news is, it doesn’t have to be that way. With the right tools, a few simple reminders, and a clear process in place, staying on top of your payroll tax obligations can become easier. By being proactive and organised, you’re not just ticking a compliance box, you’re protecting your business and giving yourself peace of mind.