Free Payroll Tax Calculator Australia (All States) (NSW)
For NSW employers near or over the $1.2M threshold: estimate Revenue NSW payroll tax, taxable wages and your effective rate.
Last updated 31 May 2026
This NSW payroll tax calculator estimates what your business owes Revenue NSW once total Australian wages cross the New South Wales threshold. For the current financial year, NSW applies a tax-free threshold of around $1,200,000 and a headline rate of 5.45%, among the higher rates in the country. You pay only on wages above the threshold, not the full bill. Enter your projected full-year wages, including superannuation and the grossed-up value of fringe benefits, and the calculator returns your estimated payroll tax, the taxable amount above the threshold and your effective rate. NSW lodgements are made monthly through Revenue NSW with an annual reconciliation, and the monthly threshold is pro-rated. Grouping and interstate wages can change your result, so treat this as a budgeting estimate and confirm current figures with Revenue NSW or your accountant.
How to use this tool
- 1
Enter your total annual Australian wages
Include gross salaries and wages, most allowances, bonuses, commissions, directors' fees, the grossed-up value of taxable fringe benefits and superannuation. Use your projected full financial-year figure for the most useful estimate.
- 2
Select your state or territory
Choose where the work is performed. The calculator applies that jurisdiction's current tax-free threshold and headline rate, since NSW, VIC, QLD, WA, SA, TAS, ACT and NT each set their own.
- 3
Read your estimate and email it to yourself
See your estimated payroll tax, taxable wages above the threshold and effective rate. Use the email option to send the result to yourself or your bookkeeper for budgeting and BAS planning.
How payroll tax actually works in Australia
Payroll tax is levied by each state and territory, not the federal government, so there is no single Australian rate. You become liable once your total annual taxable wages exceed your state's tax-free threshold, and you pay only on the portion above that threshold, not the whole wage bill. That distinction matters: a business on $1.5M of wages in a state with a $1.2M threshold pays tax on $300,000, not $1.5M. Taxable wages are broader than many owners expect. They include gross salaries and wages, directors' fees, most allowances, bonuses and commissions, the superannuation guarantee (now 12% from 1 July 2025), and the grossed-up taxable value of fringe benefits. Contractor payments can also be caught if the arrangement looks like employment under the relevant contractor provisions. Registration is generally required within seven days of the month you first exceed the threshold, and returns are usually lodged monthly with an annual reconciliation. Because the calculator works off a full-year figure, treat it as a planning estimate rather than a substitute for your monthly lodgement, where the threshold is pro-rated across the months you employed staff.
Thresholds and rates differ in every state
This is where employers most often get caught out, especially when they hire across borders. As a rough guide for the current financial year, NSW applies roughly a $1.2M threshold at 5.45%, Victoria a $1M threshold at 4.85% (with a lower regional rate), Queensland a $1.3M threshold at 4.75% for payrolls up to $6.5M, and WA a $1M threshold at 5.5% with the tax-free amount tapering away as wages climb. SA, Tasmania, the ACT and NT each set their own figures again, and several states add surcharges or levies on large payrolls, such as Queensland's mental health levy and Victoria's mental health and wellbeing surcharge. If you employ staff in more than one state, you do not get a full threshold in each. The threshold is shared and apportioned based on the proportion of your Australian wages paid in that state, which often pushes your effective rate higher than the headline figure suggests. Always confirm the current-year numbers on your state revenue office website before you budget against them, as rates and thresholds are reviewed regularly.
Grouping rules can quietly increase your bill
One of the biggest surprises for growing Australian businesses is grouping. State revenue offices can treat related entities as a single group for payroll tax: companies under common control, businesses sharing employees, or entities linked through trusts and holding structures. When you are grouped, the group gets only one tax-free threshold between all members, and every entity becomes jointly liable. A common trap is splitting a business into an operating company and a service or labour-hire entity, assuming each gets its own threshold, then discovering the wages are combined and the threshold is claimed only once by a designated group member. The grouping provisions are deliberately broad and catch arrangements you might not think of as connected. If your structure involves multiple trading entities, a family group, or shared administration staff, get specific advice before you rely on any single-entity estimate. This calculator assumes a standalone employer, so grouped businesses should run their combined Australian wages through it to get a realistic group-level figure.
From manual wage tracking to automated reporting
Most payroll tax mistakes are not deliberate. They come from manual tracking: wages spread across spreadsheets, fringe benefits and superannuation added late, interstate splits done by hand at year end, and monthly thresholds calculated under time pressure before each lodgement. The risk grows as you approach and cross the threshold, exactly when cash flow is already tight. A one-off calculator like this is a good sense check, but it cannot watch your wages month to month or flag the month you tip over. That is the gap where a connected payroll and reporting setup pays off. When your payroll system (Xero, MYOB, Employment Hero or similar) feeds clean, categorised wage data into a reporting layer, your payroll tax position can be tracked continuously, interstate wages apportioned automatically, and lodgement-ready figures produced without manual reconciliation. If you keep recalculating payroll tax by hand each month, that recurring task is a strong candidate for automation, and it is the kind of finance workflow Clever Ops builds for mid-market Australian employers.
Payroll tax for NSW employers
New South Wales has one of the larger payroll tax bases in Australia and one of the higher headline rates, currently around 5.45% on wages above a tax-free threshold of roughly $1,200,000. Revenue NSW administers the tax, and most employers lodge monthly returns with an annual reconciliation after 30 June. The monthly threshold is pro-rated, so the full $1.2M is spread across the year rather than available in any single month. NSW taxable wages include gross salaries, directors' fees, most allowances, bonuses, the superannuation guarantee and the grossed-up value of fringe benefits, and certain contractor payments can be caught under the relevant contractor provisions. NSW also applies grouping rules: related entities under common control or sharing employees are grouped and share a single threshold, with each member jointly liable. A frequent trap for Sydney businesses is splitting into an operating entity and a labour or service entity, expecting two thresholds, then finding the wages combined. If you employ staff outside NSW, your NSW threshold is apportioned based on the share of wages paid in the state, which lifts your effective rate. Always verify the current rate and threshold on the Revenue NSW website before budgeting, as they are reviewed regularly.
Worked example
A mid-market NSW employer projects its full financial-year wages, including superannuation, to estimate payroll tax for budgeting.
- Total annual Australian wages
- $1,500,000
- State or territory
- New South Wales
- Tax-free threshold
- $1,200,000
- Headline rate
- 5.45%
Taxable wages above threshold: $300,000. Estimated payroll tax: $16,350. Effective rate across the full wage bill: 1.09%.
Although the headline NSW rate is 5.45%, the business pays tax only on the $300,000 above the $1.2M threshold, so $16,350. Spread across the full $1.5M wage bill, the effective rate is just 1.09%, which is the figure worth using in cash-flow planning rather than the headline rate.
Who uses this tool
A Sydney firm crossing the threshold
A professional services firm reaches $1.4M in wages and uses the tool to estimate the 5.45% liability on the $200K above the NSW threshold before its first Revenue NSW lodgement.
A NSW employer with interstate staff
A business headquartered in Sydney with remote workers in QLD models how apportioning its NSW threshold lifts its effective rate above 5.45%.
A Newcastle bookkeeper
A bookkeeper estimates a client's annual NSW payroll tax line for budgeting, then emails the result for sign-off ahead of monthly lodgements.
Frequently asked questions
Is payroll tax a federal or state tax in Australia?
Payroll tax is a state and territory tax, not a federal one. Each of the eight jurisdictions sets its own tax-free threshold, headline rate, deductions and surcharges, and administers its own registration and lodgement. There is no single national payroll tax rate, which is why this calculator asks you to choose your state before estimating your liability.
What wages are included in the payroll tax calculation?
Taxable wages are broad. They cover gross salaries and wages, directors' fees, most allowances, bonuses and commissions, the superannuation guarantee (12% from 1 July 2025), and the grossed-up taxable value of fringe benefits. Some contractor payments are caught too. Enter your total Australian wages including super for the most accurate estimate, then confirm inclusions with your accountant.
Do I pay payroll tax on my whole wage bill?
No. You pay only on the portion of wages above your state's tax-free threshold. If your wages are below the threshold, you generally pay nothing and may not need to register. The calculator shows the threshold, the taxable wages above it, and an effective rate that spreads the tax across your entire wage bill so you can see the true cost.
How accurate is this payroll tax calculator?
It gives a solid planning estimate using each state's current threshold and headline rate. It does not model grouping, interstate apportionment, regional rates, large-payroll surcharges, or the pro-rated monthly threshold used at lodgement. Treat it as a budgeting guide and confirm the final figure with your accountant or state revenue office before you lodge or pay.
What happens if I employ staff in more than one state?
You do not get a full tax-free threshold in each state. The threshold is shared and apportioned based on the proportion of your Australian wages paid in that jurisdiction. This usually pushes your effective rate above any single headline rate. Multi-state employers should run their combined Australian wages through the tool, then get advice on the apportionment.
When do I have to register for payroll tax?
Generally, you must register once your total Australian wages exceed your state's tax-free threshold, often within seven days of the end of the month you first go over. Returns are usually lodged monthly with an annual reconciliation. Check your specific state revenue office for exact registration deadlines, as the rules and timing vary by jurisdiction.