Payroll tax in Tasmania applies to an employer that pays wages in Tasmania when its total Australian wages, or its group's, are more than $1.25 million a year. Tax is charged at 4% on taxable wages between $1.25 million and $2 million, and 6.1% on wages above $2 million. Monthly returns are due on the 7th of the following month, and the annual adjustment return by 21 July.
Those thresholds and rates apply for the 2026-27 financial year and have been the same since 1 July 2022. Every figure below comes from the State Revenue Office of Tasmania, as of October 2026.
Rates and thresholds for 2026-27
| Taxable wages | Rate |
|---|---|
| Up to $1.25 million | No payroll tax |
| Between $1.25 million and $2 million | 4% |
| Over $2 million | 6.1% |
Employers that don't want to claim a threshold, or can't, pay 6.1% on all their Tasmanian taxable wages for the month. The threshold only reduces your bill if you claim it, so registering correctly matters.
When you have to register
You're liable if you pay wages to employees in Tasmania, whether your business is in Tasmania or elsewhere, and your total wages paid in Australia are greater than $1.25 million per annum, or $24,038 per week during a month. You're also liable if you're a member of a group whose total Australian wages exceed those amounts, and every Tasmanian wage-paying group member must register.
Here's the detail people miss: the weekly figure is tested during a month. A business that's growing fast, or pays a large bonus in one month, can cross the line in that month even before its annual total looks big enough. Watch the weekly average, not just the year.
How the monthly threshold works
The monthly threshold isn't a twelfth of the year. It's the number of days in the month divided by the days in the year, multiplied by $1.25 million, and the same calculation with $2 million gives the top bracket. Amounts are rounded to the nearest whole dollar, and they're also apportioned if you're a group member. If Australia-wide wages aren't available each month, you can use one twelfth of last year's Australia-wide wages as an estimate.
A worked example from the SRO
The SRO's 2025-26 annual adjustment guideline works through an ungrouped employer paying $2.4 million in Tasmanian wages for the full year:
| Slice of wages | Rate | Tax |
|---|---|---|
| $2 million minus $1.25 million = $750,000 | 4% | $30,000 |
| $2.4 million minus $2 million = $400,000 | 6.1% | $24,400 |
| Total for the year | $54,400 |
For an employer that only paid wages for part of the year, both thresholds are scaled by the days it employed people, which pushes more of the wages into the taxed bands.
Return and payment dates
| Return | Due |
|---|---|
| Monthly return | The 7th of the following month, for example the September return is due 7 October |
| Annual Adjustment Return (AAR) | 21 July, or the first working day after if the 21st isn't a working day |
- The AAR reconciles the tax for the financial year and decides whether you get a refund or owe more. If you lodge monthly, it replaces your June return.
- Complete the Annual Confirmation in Tasmanian Revenue Online (TRO) first. If you skip it, you won't receive a threshold entitlement when you submit the annual return.
- If you lodge late, TRO calculates the interest owing. An interim payment can reduce penalty tax and interest if you can't finish the return in time.
- If you don't lodge at all, you'll get an estimated assessment, which you must either amend or pay.
What counts as taxable wages
Salaries and wages, commissions, annual, long service and sick leave, pay in lieu of notice, non-monetary superannuation contributions, travel and accommodation allowances above the prescribed rates, bonuses, prizes and incentive payments, and employer make-up payments for workers compensation. Contractor and employment agency rules can bring other payments in too.
Wages paid by certain employers are exempt under Part 4 of the Payroll Tax Act 2008, including religious institutions, non-profit private hospitals, private schools up to secondary level, public benevolent institutions and non-profit charitable organisations.
Grouping
Related companies are grouped under section 50 of the Corporations Act, and businesses are also grouped where employees work across them or the same people have a controlling interest in each. The Commissioner can exclude a business that runs independently of the group, but there's no de-grouping for related corporations. Grouping matters because it's the group's Australian wages, not each company's, that are compared with the $1.25 million.
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Registering through TRO
You register, lodge and pay through Tasmanian Revenue Online. Before you start, the SRO suggests having your ABN or ACN, trading names, contact and bank details, company grouping details and salaries and wages information ready, plus a company extract, trust deed, partnership agreement or similar document depending on your structure. TRO then calculates the tax from your registration and grouping details each time you lodge. If you stop paying wages in Tasmania, you cancel the registration in TRO after lodging any outstanding returns and settling what you owe.
Rebates
Tasmania runs a payroll tax rebate scheme for employers who take on apprentices, trainees or youth employees aged between 15 and 24, in full-time or part-time positions, with eligibility criteria.
Payroll tax sits alongside your federal obligations. If you're new to the employer side, start with how payroll tax works and Single Touch Payroll reporting, which is separate.
The verdict
Tasmania's payroll tax is one of the simpler regimes: two rates, two thresholds, monthly returns on the 7th and a 21 July reconciliation. The traps are grouping, the weekly test during a month, and forgetting the Annual Confirmation, which costs you the threshold. If your Australian wages are approaching $1.25 million, register before you cross it.
Frequently asked questions
What is the payroll tax threshold in Tasmania?
$1.25 million a year in total Australian wages, or $24,038 per week during a month, as of October 2026.
What are the payroll tax rates in Tasmania?
4% on taxable wages between $1.25 million and $2 million, and 6.1% on wages over $2 million, for 2026-27.
When are Tasmanian payroll tax returns due?
Monthly returns are due by the 7th of the following month. The Annual Adjustment Return is due by 21 July.
How is the monthly threshold worked out?
Days in the month divided by days in the year, multiplied by $1.25 million, and the same with $2 million for the top bracket.
What happens if I skip the Annual Confirmation?
You won't receive a threshold entitlement when you submit your Annual Adjustment Return.
