Grouping and de-grouping

    The grouping provisions are set out in Part 5 of the Payroll Tax Act 2008 and provide for employers to be                       grouped​ where:
  • companies are 'related'; or  
  • employees of one business are used in another business; or  
  • the business conducted by persons, corporations, partnerships or trusts are commonly controlled.

     A busi​ness is defined to include: ​

  • a trade or profession; 
  • any other activity carried on for fee, gain or reward; 
  • the activity of employing one or more persons who perform duties in connection with another business; 
  • the carrying on of a trust (including a dormant trust); and 
  • the activity of holding any money or property used for, or in conn​​ection with another business, 
    whether carried on by​ 

​​ ​​​

​    The Commissioner has the discretion to exclude an employer from a group provided the business carried                     on by the employer seeking exclusion is carried on independently of, and is not connected with, the business               carried on by any other member of that group (section 79 of the Payroll Tax Act 2008).

     In considering whether the businesses are operating independently of each other and are not connected, the                Commissioner will have regard to a range of factors including: ​
  • who makes the day-to-day management decisions for each business; 
  • the extent the persons who commonly control each business get involved in the day-to-day operations of the businesses;
  • any common customers; 
  • whether the principal activities of the businesses are complementary or supplementary to each other, including group purchasing or supply arrangements; 
  • the extent that the business seeking an exclusion, trades with or provides services to any other group member; 
  • ​the extent that the businesses share resources; 
  • the extent of financial dependence between group members including provision of initial or on-going working capital; 
  • if a group member provides a loan to another member, whether this capital was provided on a strictly commercial basis; for example, the Commissioner would consider such things as formal agreements, commercial interest charged, ​if repayment schedules were adhered to and the extent of security provided for the loan where appropriate.
​     There is no provision to allow for the de-grouping of corporations that are related under the Corporations Act (see        Section 70 of the Payroll Tax Act 2008).

    You can apply to de-group on Tasmanian Revenue Online under the Company Grouping section and the 
    Payroll Tax Exclusion from Grouping application​ to apply for an exclusion from grouping. ​​​

Payroll tax
Commonly controlled businesses


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