Tax Tip - Jobs Action Plan

The Jobs Action Plan is a key priority of the NSW government and provides NSW businesses with a payroll tax rebate when they employ new workers in new eligible employment.

Eligible businesses that increase the number of NSW full-time equivalent employees will receive a rebate of up to $5,000 over a 2 year period for each additional NSW employee in a new job at the anniversary date of employment.

To be eligible for the Jobs Action Plan your business must be registered with the NSW Office of State Revenue as an employer and be paying payroll tax in NSW (i.e. have total taxable wages of more than $750,000 per annum).

Eligible employment

The employment of a person is eligible for the rebate if the employment meets all of the following:

The person is employed full-time, part-time or on a casual basis in a position that is a new job
The employment commences on or after 1 July 2011
The employment is maintained for a period of at least 2 years to be eligible for the full rebate
The services of the employee are performed wholly or mainly in NSW

Excluded employment

There are a number of employment circumstances that are excluded from being eligible for the rebate, however the most common exclusions are:

The person was employed by the employer claiming the rebate in the previous 12 months
The employer is already entitled to a payroll tax rebate (i.e. apprentice/trainee rebate)
Any wages paid by the employer to the person are not taxable wages (i.e. the wages must be subject to payroll tax in the first place)

New job

A new job is created if the number of your NSW full-time equivalent employees increases and the number is maintained over a 2 year period from the creation of the new position.

Minimum employment period

To be eligible for the rebate, the minimum employment period is 2 years starting on the date of employment.

Employment is maintained if there is always a person employed in that position.

A vacancy in a position can be disregarded if the number of days the position was vacant does not exceed a total of 30 days.

Registration for the rebate

An employer is required to register the employment of a person in a position that is a new job and advise the NSW Office of State Revenue of the number of full-time equivalent employees immediately before the new position was filled. A formula to calculate an employer's number of full-time equivalent employees is provided on the NSW Office of State Revenue website.

Registration for the rebate must be made within 90 days after the employment commences on the NSW Office of State Revenue website.

Payment of the grant

The rebate is paid by Electronic Funds Transfer in two parts, on the first and second anniversary of employment of an additional person in a new job.

For full-time employees, the grant is $2,000 on the first anniversary and $3,000 on the second anniversary.

In the case of part-time or casual employees, the grant amount will be pro-rated based on full-time equivalent hours of employment. A formula is provided on the NSW Office of State Revenue website.

Note, the amount of the rebate paid for each year cannot exceed the employer's total payroll tax liability for that year.

Claiming the grant

In order to claim the rebate you must lodge an online application on the NSW Office of State Revenue website within 30 days after the end of the relevant year of employment.

More information

If you would like more information or require assistance in registering for the rebate, please contact our office on (02) 9894 8884.

Sincerely,

The Team at
Vantage Partners
02 9894 8884

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Important: Clients should not act solely on the basis of the material contained in this tax tip. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. Tax tips are issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our prior approval.