It Depends – The expanding reach of payroll tax – are your passive assets and Superannuation up for grabs?

In this edition of It Depends, special counsel Tom Walrut covers the expanding reach of payroll tax into passive investment and superannuation assets.

In this edition of It Depends, special counsel Tom Walrut covers the expanding reach of payroll tax into passive investment and superannuation assets.

Tom will be presenting on this topic at our Annual Adviser Conference on 26 and 27 March 2026. Register now.

Video transcript

Hi, my name's, Tom Walrut and welcome to this week's special Adviser Conference edition of It Depends where we'll be talking about the expanding reach of payroll tax into passive investment assets and superannuation assets.

So, when can State Revenue authorities chase passive investment assets and superannuation assets to satisfy unpaid payroll tax debts? Well, as always, the answer is it depends. And it depends on whether the entities that hold the passive investment assets or superannuation fund and the trading business form a payroll tax group.

What is a payroll tax group?

Payroll tax groups arise under a number of different circumstances, but typically they arise where businesses have common controllers or are otherwise commonly owned.

Why does the grouping matter for trusts?

Why does grouping matter for trusts? Well, the grouping provisions for payroll tax purposes are drafted extraordinarily broadly, which means most trusts and most superannuation funds will form a group with any trading business within the broader group.
But more importantly, all members of the group are jointly and severally liable for payroll tax, which means that unpaid payroll tax liabilities of, say, the trading business in the group, are required to be met by other members of the group, being those discretionary trusts and superannuation funds that also form part of the payroll tax group.

So, what can you do?

So, what can you do about this? First things first. Ideally, set up your structure to avoid any grouping in the first instance. Practically however, given how these provisions are drafted, that's not always achievable.

The second option is set up your structure so that it is favourable for the Commissioner to exercise its discretion to de group your investment entities from your trading businesses. And probably more importantly, actually apply for the de grouping application as soon as possible.

So, that if there are any future payroll tax liabilities, you're not stuck having your passive investment assets or self managed super fund assets liable to pay those payroll tax, liabilities. We'll be talking about all this and more at the CGW Annual Adviser Day on the 26th and the 7th of March. The link will be in the description below, and I'll look forward to seeing you there. Bye.

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