In the ACT, you pay payroll tax only if your taxable wages, or your group's, are above the threshold. From 1 July 2026 that threshold is $1.75 million a year, or $145,833.33 a month, down from $2 million. The general rate for 2026-27 is 6.75% for employers with Australia-wide wages up to $20 million, rising in bands to 8.75% above $150 million.
The lower threshold means some ACT businesses that never paid payroll tax will cross the line this financial year without hiring anyone new. Everything below comes from the ACT Revenue Office's payroll tax pages, as of October 2026.
ACT payroll tax rates for 2026-27
| Annual Australia-wide wages | General rate |
|---|---|
| More than $1.75 million, up to $20 million | 6.75% |
| More than $20 million, up to $50 million | 6.85% |
| More than $50 million, up to $100 million | 7.35% |
| More than $100 million, up to $150 million | 7.85% |
| More than $150 million | 8.75% |
The rate depends on Australia-wide wages at the group level, not just your ACT wages, and the rate for eligible universities is capped at 6.85%. Before 1 July 2026, the general rate was 6.85% with surcharges on larger employers.
When you must register
By law, you must apply to register within 7 days after the end of the month in which you go over the threshold. Because the test is monthly, a business can trigger registration in a single strong month, well before its annual wages reach $1.75 million.
How the tax-free threshold is worked out
You don't get the full threshold if you also pay wages interstate or didn't pay wages all year. The ACT Revenue Office sets out 3 steps:
- Proportion the $1.75 million annual threshold by the number of days in the financial year you paid or owed ACT or interstate wages.
- Divide your ACT taxable wages by your Australia-wide wages, and multiply by that adjusted threshold, or by the monthly threshold for a monthly return.
- Subtract the result from your ACT taxable wages and multiply what's left by the general rate for your Australia-wide wages.
Steps 2 and 3 apply to monthly returns; all 3 apply to the annual reconciliation. You can choose not to claim the threshold monthly and keep the option to claim it in the annual return. A business group member that isn't an approved designated group employer pays on its ACT wages at the rate for the group's Australia-wide wages.
A quick check before 1 July paperwork
- Add up the group's Australia-wide wages for the year, including super, contractors and fringe benefits.
- Compare each month's ACT wages with the $145,833.33 monthly threshold, not just the annual total.
- If you're over, register within 7 days after the end of that month.
- Decide whether to claim the threshold monthly or leave it to the annual reconciliation.
- Diarise the 7th of each month, 14 January for December, and 28 July for the annual return.
Due dates
| Return | Due |
|---|---|
| July to November, and January to May | The 7th day of the following month |
| December | 14 January |
| June | No separate return; included in the annual reconciliation |
| Annual reconciliation | 28 July |
If a due date falls on a weekend or public holiday, it moves to the next working day. Returns are lodged in the ACT Revenue Office Self Service Portal. Payroll tax is self-assessed: you lodge at the agreed frequency, monthly or annually, and pay the tax at the same time, so nobody sends you a bill to prompt you.
What counts as taxable wages
- Salary, wages, commission, bonuses, allowances and other benefits.
- Superannuation contributions.
- Payments to contractors, unless the contract is exempt.
- Director's fees, eligible termination payments and payments to employment agencies.
- Fringe benefits and employer contributions to employee share schemes.
Exempt wages include paid parental leave, the tax-free part of redundancy payments, workers compensation paid under a scheme, and wages for new starters receiving eligible training. The inclusion of super is why superannuation guarantee increases also lift your payroll tax base.
Contractors, agents and groups
Many ACT businesses use contractors rather than staff, and that doesn't take them outside payroll tax: payments to contractors are taxable wages unless the contract is exempt. Employment agencies pay the tax on wages for the people they place, whoever pays the worker, and in some circumstances an agent can exclude payments it makes to independent contractors. Any GST in an employment contract isn't subject to payroll tax.
Grouping is the other trap. Related companies and trusts can be grouped for payroll tax, and a group's Australia-wide wages decide both whether the threshold is crossed and which rate applies. The ACT Revenue Office has a tool to help you check whether your business is a group member, and groups can nominate a designated group employer to claim the threshold.
Want AI doing the heavy lifting in your marketing?
I build the systems that handle the boring 80 percent, so you get your week back. Done properly, with the human kept in.
How the ACT compares
All states and territories have harmonised their payroll tax administration in a number of key areas, but thresholds and rates still differ, and the ACT threshold is apportioned by your share of Australia-wide wages. If you also employ in Sydney, see payroll tax in NSW for that side of the payroll.
The verdict
If your group's Australia-wide wages sit anywhere between $1.75 million and $2 million, check now: you may have crossed the ACT threshold on 1 July 2026 without noticing. Register within 7 days of the month you go over, and remember that contractors and super count toward the total. Penalty tax and interest apply on late payments, though the Commissioner can reduce them for extenuating circumstances.
Frequently asked questions
What is the payroll tax threshold in the ACT?
From 1 July 2026 the ACT threshold is $145,833.33 a month, or $1.75 million a year. Before that it was $2 million a year.
What is the ACT payroll tax rate for 2026-27?
6.75% for Australia-wide wages above $1.75 million up to $20 million, rising in bands to 8.75% above $150 million.
When must I register for ACT payroll tax?
You must apply to register within seven days after the end of the month you go over the threshold amount.
When are ACT payroll tax returns due?
Monthly returns are due by the 7th of the following month, December's by 14 January, and the annual reconciliation by 28 July.
Is superannuation included in ACT payroll tax?
Yes. Superannuation contributions are included in taxable wages for ACT payroll tax.
