Payroll tax and contractors in South Australia
RevenueSA's guidance says payments to contractors under a relevant contract are taxable unless an exemption applies. Where the contract shows materials or equipment separately, the work part alone is taxable, and labour that is secondary to the contractor's supply of materials or equipment is exempt.
- By Book Keeping Pros
- Sources checked 15 Oct 2026
The rules in South Australia
| What it is | Value | When it applies | Where it is set |
|---|---|---|---|
| Payments to contractors under a relevant contract are taxable unless an exemption applies | Yes | As published on 13 November 2024 | What are the 6 exemptions that exclude contracts from payroll tax? |
| Most days in a financial year a contractor can provide services and be exempt | 90 days | As published on 13 November 2024 | 90 day exemption |
| Days a year the business ordinarily needs the services, below which they are exempt | 180 days | As published on 13 November 2024 | 180 day exemption |
| Labour secondary to the contractor's supply of materials or equipment is exempt | Yes | As published on 13 November 2024 | Services ancilliary to the supply of goods |
| Services are exempt if the commissioner is satisfied the contractor serves the public generally | Yes | As published on 13 November 2024 | Ordinarily Rendering Services to the Public |
| Only the work part is taxable when a contract shows materials or equipment separately | Yes | As published on 13 November 2024 | What happens if the contract provides for the supply of equipment and/or materials in addition to labour? |
Each rule is read from the source and provision shown; the sources are listed below. Checked 15 Oct 2026.
What it means for your books
- That split depends on how the contract is written, so the books can hold each contractor's contract and invoices, with the materials or equipment amounts recorded apart from the work.
- Where materials or equipment are the main thing a contractor supplies, the quote or contract describing them shows why the labour is treated as secondary to that supply.
- RevenueSA's day-based exemptions call for dates: when each contractor worked during the financial year, and on how many days in a year that kind of service is ordinarily required.
- The public generally exemption applies when the commissioner is satisfied the contractor serves the public generally, so any letters exchanged with RevenueSA about a contractor belong in that contractor's file. RevenueSA or your accountant can answer whether a given contract falls under the relevant contract rules.
General information
Sources
- Payroll tax and contractors
RevenueSA (Government of South Australia). Page modified 2024-11-13 (modified-time metadata), released 13 November 2024. Checked 16 October 2026.
© Government of South Australia, licensed under CC BY 3.0 AU Licence: CC BY 3.0 AU.
- Payroll tax rates and thresholds
RevenueSA (Government of South Australia). Rates from 1 January 2019, deduction from 1 July 2009, released 8 July 2026. Checked 15 October 2026.
© Government of South Australia, licensed under CC BY 3.0 AU Licence: CC BY 3.0 AU.
Bookkeeping for employers
Keep your books ready for the questions employers get asked
We look after day-to-day bookkeeping for businesses across Australia, so your records are up to date when you need them.