Australia Regulatory Updates – November 2021

Several updates have been made to many of the regulatory policies in Australia over the past few months. From reduced tax rates to extended paid leave accessibility, below are some of the key updates employers will want to make note of.

The company tax percentage for base rate establishments was reduced in early 2021 from 26% to 25%. Australian government officials have declared that the rate will remain at the reduced percentage of 25% for the remainder of 2021 and going into 2022. In order to be considered a base rate entity, establishments must meet the following criteria:

• Aggregate turnover equates to AUD 25 million or less for the period 2017-18 and AUD 50 million for the period 2018-19, and
• No more than 80% of their taxable income qualifies as base rate entity passive income

Employer Considerations:

Establishments that meet base rate criteria can benefit from the reduced company tax rate in evaluating their corporate tax liabilities. The standard tax rate for other establishments not classified as base rate entities remains at 30%.

A new Bill has been implemented amending the Fair Work Act 2009, in efforts to extend paid parental leave benefits to parents dealing with stillbirths. The Fair Work Amendment Bill 2021 entitles all employees to the same amount of paid parental leave regardless of the result of the pregnancy. The current period of Paid Parental Leave granted is 12 weeks. With this Bill, employees will be protected from PPL cancellations by employers based on the birth result.

Additionally, a few modifications have been made to the paid parental leave scheme with the implementation of the Paid Parental Leave Amendment (COVID-19 Work Test) Bill 2021. Individuals receiving a COVID-19 Government or Disaster payments meet the work eligibility criteria to qualify for Parental Leave Pay (“PLP”), Dad and Partner Pay (“DaPP”).

Employer Considerations:

Employers will need to revisit the current payroll policies that they have set in place and make adjustments where needed to comply with the paid parental leave policy amendments.

The deadlines for payroll tax payments for July 2021 and August 2021 were extended by the New South Wales and Queensland Government, as a result of growing COVID-19 concerns. The deadline was extended to October 07, 2021, giving employers additional time to submit their payments for the two abovementioned months. This extension was also applied to annual reconciliation submissions for the 2020-21 fiscal year, pushing the deadline to October 07, 2021.

Employer Considerations:

Employers have been given additional time to assess payroll tax and annual reconciliation liabilities.