Payroll Tax in South Australia: Rates, Thresholds and the Rules for Medical Practices
By Kaleem UllahLast Updated: Sept 23, 2026|4 min read
Payroll tax is a South Australian state tax on wages paid by an employer, and it catches more businesses than the name suggests, contractor payments can be caught too, which is exactly what has made this a live issue for medical practices contracting GPs. This guide covers the current thresholds and rates for any SA business, then the specific, current rules for medical practices.
SA payroll tax thresholds and rates
| Wages (annual) | Tax treatment | Rate |
|---|---|---|
| Up to $1.5 million | Exempt | 0% |
| $1.5 million to $1.7 million | Partial deduction, variable rate | 0% to 4.95% |
| Above $1.7 million | Full rate applies | 4.95% |
Taxable wages include salaries, superannuation, allowances and fringe benefits paid to South Australian employees, and can extend to payments made to contractors where the arrangement is a “relevant contract” under the Payroll Tax Act 2009 (SA), which is the provision that brought medical practices into scope even though GPs are typically engaged as contractors, not employees.
Payroll tax and medical practices contracting GPs
Court decisions in several states have held that a medical practice's payments to a contracted GP may be treated as taxable wages under the relevant contract provisions, even though the GP is not legally an employee. South Australia's current position, following Revenue Ruling PTASA004, has two separate parts.
The historical amnesty (now closed)
An amnesty covered payments to contracted GPs, other specialists and dentists from 1 July 2018 to 30 June 2024. Registration for this amnesty closed on 30 November 2023 and cannot be applied for again. A practice that did not register within that window remains exposed to historical assessment for that period.
The current bulk-billing exemption
From 1 July 2024, wages paid to GPs, both contractors and employees, are exempt from payroll tax to the extent they relate to bulk-billed consultations. This exemption does not extend to income from privately billed consultations, and it does not extend to non-GP specialists, dentists, nurses, receptionists, administrative staff, pathology staff, or allied health staff, all of which remain assessable under the ordinary rules.
What this means in practice
A practice with a mix of bulk-billed and privately billed GP income needs to separate the two for payroll tax purposes, the exemption applies to one and not the other. A practice with specialists or allied health contractors alongside its GPs cannot assume the GP exemption covers everyone under the same roof.
What medical practices should do
- Confirm whether your GP contractor arrangements meet the relevant contract test under PTA041, rather than assuming contractor status alone puts you outside payroll tax
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- Separate bulk-billed and privately billed GP income in your billing and accounting records, since only one is currently exempt
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- Review the payroll tax position of any specialists, dentists and allied health contractors separately from your GPs
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- If your practice did not register for the amnesty before it closed, get advice on your exposure for the 1 July 2018 to 30 June 2024 period, specifically
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Our accountant for doctors in Adelaide service works through this exposure and the ongoing bulk-billing exemption for South Australian practices.
Frequently Asked Questions
Kaleem Ullah
Kaleem is CEO & Author at "The Kalculators". With more than 10 years of experience in financial services, he built Kalculators to transform your financial challenges into strategic triumphs!
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