Federal tax gets most of the attention, but for growing businesses and property investors, state taxes are often where the unpleasant surprises come from. A second business pushes the first one over the payroll tax threshold. A property bought in the family trust comes with a land tax bill the same property in your own name wouldn't have had. A restructure that saves income tax triggers stamp duty nobody priced.
Each state and territory runs its own rules. Here's how they work, where they catch people, and how we help.
What are the main state taxes for businesses and investors?
| Tax | Who it hits | When it applies | Where it catches people |
|---|---|---|---|
| Payroll tax | Employers (and groups) whose total wages exceed the state threshold | Monthly returns once registered, with an annual reconciliation | Grouping, contractors treated as employees, interstate wages |
| Land tax | Owners of land other than (generally) their home and primary production land | Annually, based on what you own on the state's test date | Trust rates and thresholds, foreign surcharges, land held in several names |
| Stamp (transfer) duty | Buyers of land and, in some states, other business assets | On a transfer or agreement to transfer | Related-party transfers, restructures, landholder duty on buying shares or units |
Every figure below is for 2026–27 (or the 2026 land tax year), from the state revenue offices. Rates change, sometimes mid-year, so we check the current figure every time we advise.
How does payroll tax work in each state?
Payroll tax applies once your total Australian wages pass a threshold. Wages include salaries, super, fringe benefits, some termination payments and, in some cases, payments to contractors. The threshold is reduced in each state by the share of your wages paid elsewhere.
| State | Annual threshold | Rate (2026–27) |
|---|---|---|
| NSW | $1,200,000 | 5.45% |
| VIC | $1,000,000 (phases out between $3m and $5m of wages) | 4.85%; 1.2125% for eligible regional employers; surcharges above $10m |
| QLD | $1,300,000 (deduction reduces above that, to nil at $10.4m) | 4.75% up to $6.5m of wages; 4.95% above; regional discount available |
| SA | $1,500,000 | Phases in between $1.5m and $1.7m; 4.95% above $1.7m |
| WA | $1,000,000 (phases out up to $7.5m) | 5.5% |
| TAS | $1,250,000 | 4% on wages from $1.25m to $2m; 6.1% above $2m |
| ACT | $1,750,000 (down from $2m on 1 July 2026) | 6.75% for Australian wages from $1.75m to $20m; higher tiers above |
| NT | $2,500,000 | 5.5%; 6.5% for $100m+ of Australian wages |
Our guide to payroll tax by state explains what counts as wages and how the interstate calculation works.
What is payroll tax grouping?
Grouping treats related businesses as one employer for payroll tax. The group gets one threshold, and every member is jointly liable for the whole group's tax. Businesses are grouped where, broadly:
- companies are related under the Corporations Act;
- the same person or people control two or more businesses (generally a more than 50% interest, or being able to control the board);
- employees work across businesses, or one business uses another's staff;
- a person is a beneficiary of a discretionary trust that carries on a business, in which case they can be treated as controlling that business.
The Commissioner can exclude a business from a group if it's run independently, but you have to apply, and the bar is high.
Example (hypothetical, NSW 2026–27): Say one owner holds 100% of two companies: a plumbing business with $800,000 of wages and a bathroom renovation business with $700,000. Separately, both are under the $1.2 million threshold. Grouped, total wages are $1.5 million, the group gets one $1.2 million threshold, and payroll tax is 5.45% of $300,000, which is $16,350 a year. If the owner doesn't register, the back tax arrives later, with interest and penalties.
This is one of the most common problems we find when someone buys or starts a second business. If you're planning a purchase, see buying a business.
What about contractors?
All states have "relevant contract" rules that can treat payments to contractors as wages, with exemptions (for example, where the contractor serves the public generally, or the work is short-term). Medical centres, allied health practices and businesses using platform workers have been the subject of recent cases and rulings, and a High Court decision on the payroll tax contractor provisions was pending at the time of writing. We review contractor arrangements before an audit does. Our page for medical practices covers that sector.
How does land tax work, and why do trusts pay more?
Land tax is charged each year on the total value of taxable land you own on the state's test date. Your home and primary production land are generally exempt. The test date varies:
| State | Test date |
|---|---|
| NSW, VIC | Midnight on 31 December, for the following calendar year |
| QLD, SA, WA | Midnight on 30 June |
| TAS | 1 July |
| ACT | Quarterly (1 July, 1 October, 1 January, 1 April), with no tax-free threshold for investment property |
Ownership structure changes the bill a great deal.
| State | How trusts and companies are treated (2026 / 2026–27) |
|---|---|
| NSW | A discretionary trust is usually a "special trust" with no tax-free threshold: 1.6% from the first dollar, 2% above the premium threshold. Individuals get a $1,075,000 threshold |
| VIC | Land held in a trust is generally taxed at trust surcharge rates with a threshold of $25,000, unless the trust qualifies for an exception |
| SA | Separate trust rates with a lower threshold apply to land held on trust |
| QLD | Companies and trustees pay from $350,000 of land value; individuals from $600,000 |
| WA, TAS | Land is generally aggregated by the same owner; trust structures have specific rules |
Example (hypothetical, NSW 2026 land tax year): A block of land with a land value of $900,000. Held by an individual with no other taxable land, it's under the $1,075,000 threshold: no land tax. Held by a discretionary trust that is a special trust: 1.6% × $900,000 = $14,400 a year.
That doesn't mean a trust is the wrong owner. It may give protection and flexibility that are worth more. But the cost should be known before you buy, not discovered on the first assessment. Our page on protecting the family home and our asset protection service cover the other side of the trade-off.
Foreign surcharges and the trust deed trap
Most states charge extra land tax and duty on residential property owned by foreign persons. A discretionary trust can be treated as foreign if its deed doesn't exclude foreign beneficiaries, even if none has ever received a cent.
| State | Foreign land tax surcharge | Foreign duty surcharge |
|---|---|---|
| NSW | 5% of land value, no threshold | 9% |
| VIC | 4% absentee owner surcharge | 8% |
| QLD | 3% above $350,000 | 8% |
| SA | No land tax surcharge found (check current rules) | 7% |
| WA | Check current rules | 7% |
| TAS | 2% | 8% (residential) |
| ACT | 0.75% of AUV (residential) | Check current rules |
If your family trust owns or plans to buy residential property, we check the deed. If it needs amending, your solicitor prepares the deed of variation, and the timing matters.
When is stamp duty payable for businesses and investors?
Stamp duty (transfer duty) is charged on the transfer of land, and in some states on other business assets. For business owners and investors, three situations matter most:
- Buying property. Duty is calculated on the price or market value, whichever is higher. First home and other concessions don't usually apply to investors or entities.
- Buying shares or units in an entity that owns land. Landholder duty can apply once the entity's land and your interest pass the state's thresholds. In NSW, for example, the land threshold is $2 million and the interest threshold is 50% (20% for a private unit trust).
- Restructuring. Moving property from your name into a trust, company or SMSF is generally dutiable at market value. Some states have corporate reconstruction exemptions or concessions for particular transfers, and each has its own conditions.
Duty is often the biggest single cost of a restructure. With many owners looking at their structures before the 1 July 2027 CGT changes, we model the duty alongside the income tax, so you see the whole cost. See our business restructuring service and the guide to strategies before 30 June 2027.
Victoria also has a commercial and industrial property tax regime: commercial and industrial property that changes hands after 1 July 2024 pays duty one last time, then moves to an annual tax after a 10-year transition. It changes the long-term maths for Victorian commercial property.
How does state tax advice work with BPAG?
- Free strategy call. Tell us what entities you have, who controls them, where you pay wages and what land you own.
- Group map. We draw your group for payroll tax and your ownership map for land tax, state by state.
- Specialist review. Our state taxes agent covers every state and territory and compares them side by side. For NSW, Victoria, South Australia and the ACT, dedicated agents go deeper into duty, land tax, surcharges, payroll tax and concessions. A qualified accountant checks every figure against the revenue office's current rules before advice goes to you.
- Fix and register. Registrations, grouping notifications, exemption applications, voluntary disclosures where something has been missed (usually with lower penalties than waiting for an audit), and briefs to your solicitor for deed amendments.
- Keep it current. Monthly payroll tax returns and the annual reconciliation, land tax assessments checked each year, and a duty check before any purchase or restructure.
BPAG runs on Nagaris. The agents draft; qualified accountants review and sign off. Nothing is lodged with a revenue office, or sent to you, without a person approving it.
We have offices in Sydney, Melbourne, the Canberra region and Adelaide, and work with clients in every state.
"We have been with BPAG for almost a year now and have felt significant improvement with the business, our own knowledge and motivation… BPAG are by far the best." Veronica Thomas, Google review
What does it cost?
Payroll tax returns for registered clients are part of our ongoing payroll work; land tax checks and duty advice are quoted as fixed fees before we start. Clients on our Fractional CFO plan (from $499 per week + GST) have proactive annual tax planning, which includes a state tax check each year. See our pricing page.
An honest point: if you have one business well under the payroll tax threshold and your only property is your home, state taxes probably aren't a problem for you yet. Come back when you hire, buy a second business or buy an investment property.
What should you send us?
- A list of every entity you, your family and your business partners control, with ownership percentages
- Trust deeds, including the beneficiary clauses
- Total wages by state for the last 12 months, and a list of regular contractors with their contracts
- Any payroll tax, land tax or duty assessments and correspondence from a revenue office
- A list of land you own, in whose name, with addresses
- For a planned purchase or restructure: the contract or proposal and the property's value
Send documents or photos from your phone in reply to our SMS or email. No portal password needed.
Frequently asked questions
When do I need to register for payroll tax?
When your total Australian wages (or your group's, if you're grouped) go over the threshold in a state where you pay wages, generally within a short time of the month you exceed the monthly threshold. Each state sets its own rule and deadline. Late registration means back tax, interest and penalties, so check monthly once you're getting close.
Are contractors included in payroll tax?
Sometimes. Under the relevant contract rules, payments to contractors can be treated as wages unless an exemption applies, for example where the contractor provides services to the public generally or the work is for a short period. Medical practices and businesses using platform workers have been a particular focus. We review your contractor arrangements against the rules in each state.
Do discretionary trusts pay more land tax?
In several states, yes. In NSW a discretionary trust is generally a special trust that gets no tax-free threshold. Victoria and South Australia apply higher trust rates with a much lower threshold, and Queensland's threshold for trustees and companies is lower than for individuals. The extra land tax is one of the costs to weigh when deciding which entity should hold property.
Is there stamp duty on transferring property into a trust or company?
Usually, yes. Transferring land to a related trust or company is generally dutiable at market value, even if no money changes hands. Some states have exemptions or concessions for corporate reconstructions, certain family transfers, primary production land and transfers on death. We check the duty before any restructure is signed.
Can a foreign beneficiary affect my family trust's land tax?
Yes. Several states can treat a discretionary trust as foreign if its deed doesn't exclude foreign beneficiaries, which can trigger foreign surcharge land tax and surcharge duty on residential property. The fix is usually a deed amendment, which must be done properly and in time. Your solicitor prepares it; we identify the problem and the deadline.
Can you get a payroll tax or land tax assessment reviewed?
Yes. If you think an assessment is wrong, there are time limits to object, usually counted from the date of the assessment. We review the assessment, gather the evidence and prepare the objection, and work with a solicitor if it goes further.
Official sources
General information only, current as at 18 October 2026. It is not personal tax, legal or financial product advice and doesn't take your circumstances into account. Talk to us before you act. Where a recommendation needs a licensed financial adviser or a solicitor, we work alongside them.