Payroll compliance in Australia
Australia ranks 65th for the complexity of its business environment, according to TMF Group’s 2022 Global Business Complexity Index, making it one of the world’s easiest countries to do business in.
Labour laws in Australia are constituted in federal and state regulations, industry-specific regulations and norms, and collective (enterprise) agreements. Australian common law includes regulations related to employment contracts between employers and employees. Most employers and employees are covered by the Federal Fair Work Act of 2009. Those not governed by the Act are covered by their state or territory industrial relations regulations.
- Australia’s Fair Work Act establishes eleven National Employment Standards (NESs) that are statutory minimum terms and conditions of employment: maximum weekly hours; requests for flexible working arrangements; offers and requests to convert from casual to permanent employment; parental leave and related entitlements; annual leave; personal/carer's leave, compassionate leave and unpaid family and domestic violence leave; community service leave; long service leave; public holidays; notice of termination and redundancy pay; Fair Work Information Statement and Casual Employment Information Statement.
- Each state and territory in Australia imposes personal income tax, in addition to federal tax.
- Since 2019, all companies in Australia must comply with the federal government’s Single Touch Payroll (STP) digital reporting obligation. STP is an initiative to reduce employers' reporting burdens to government agencies, enabling employees' payroll information – including wages, pay as you go (PAYG) tax withholding and superannuation – to be reported each time they are paid through STP-enabled software.
- A foreign worker may be employed temporarily, or nominated for permanent migration to Australia, only after the position is offered first to Australian residents, and if the pay and working conditions are not inferior to those of Australians doing comparable jobs.
If you’re doing business in Australia and are looking to learn more about Australia’s labour laws, incorporation procedures, tax implications and compliance requirements, request a copy of our full country profile, Doing business in Australia.