State duties and taxes
Duties and taxes imposed by the Victorian Government are administered by the State Revenue Office Victoria. Many of these have been abolished as a result of the introduction of the Goods and Services Tax (GST).
Further information about duties and taxes can be obtained from the State Revenue Office Victoria.
Payroll tax and other business taxes, and related expenses, are deductible from assessable income for income tax purposes, if you can establish a link between the expenses and your income-producing activities.
Payroll tax is payable under the Payroll Tax Act 2007 (Vic). It is paid by employers on their employees’ remuneration, whether in cash or otherwise, where the employer’s total wage bill exceeds a threshold amount.
Related employers may be ‘grouped’ so that the total wage bill exceeds the threshold even if it does not on an individual basis.
In certain cases, wages will be exempt from payroll tax (e.g. where the employee of a charity is engaged in charitable activities).
The Duties Act 2000 (Vic) imposes duty on certain types of transactions. This Act remains a complex area of law and is not dealt with at length here.
Certain types of agreements cannot be enforced unless they are put into writing and stamp duty is paid. Although the rate of duty is often low, the total charge can be considerable.
The Victorian Government imposes stamp duty on the following types of transactions:
- assignments and transfers of land;
- insurance contracts;
- declarations of trust over land;
- transfer or assignment of trust interests;
- some long-term leases; and
- applications for motor vehicle registration.
However, there are a number of exemptions from stamp duty, such as where the transactions relate to a marriage breakdown and wills. Duty is no longer charged in Victoria on mortgages and transfers of shares in Victorian companies.
Land tax is payable under the Land Tax Act 2005 (Vic) and is levied annually on the unimproved value of all land you own at 31 December in the year preceding the assessment year, other than your principal residence.