WA payroll tax for 2026-27 is 5.5% on taxable wages, with a $1,000,000 annual threshold. The threshold diminishes as your payroll grows. It starts reducing as soon as Australian wages pass $1 million and is nil at $7.5 million.
Published: November 2026
That makes WA different from NSW, where the threshold never reduces, and it means a WA employer on $2 million of wages pays more than the headline numbers suggest. If you want your wages tracked against the threshold for you, see our Perth bookkeeping services.
Payroll tax is a state tax on wages, administered in Western Australia by RevenueWA. It is self-assessed, so the employer is responsible for registering, lodging and paying.
Taxable wages include salary, super, bonuses, commissions, allowances, fringe benefits and some payments to contractors. The contractor rules in WA are not the same as in the eastern states, which is covered below.
RevenueWA has applied the 5.5% rate to all employers since 1 July 2023. To compare with other states, see our state-by-state payroll tax thresholds and rates guide.
You need to register with RevenueWA once you pay wages in WA and your Australian taxable wages exceed the threshold. On a monthly basis that is $83,333. As in every state, the test uses total Australian wages, and group wages if you are grouped with related businesses.
Register within seven days after the end of the month in which that happens. Registration, returns and payments run through Revenue Online, RevenueWA's portal.
Between $1 million and $7.5 million of annual Australian taxable wages, you are entitled to a deductible amount. It starts at $1,000,000 and reduces by $2 for every $13 of wages above $1 million. The fraction 2/13 is the tapering value, and it is set so the deduction reaches nil at exactly $7.5 million.
For a WA-only employer:
Worked example 1: $2,000,000 in wages.
Reduction: $1,000,000 x 2/13 = $153,846.
Deductible amount: $1,000,000 less $153,846 = $846,154.
Taxable: $2,000,000 less $846,154 = $1,153,846.
$1,153,846 x 5.5% = $63,462 for the year.
Worked example 2: $4,250,000 in wages.
Reduction: $3,250,000 x 2/13 = $500,000.
Deductible amount: $500,000.
Taxable: $3,750,000.
$3,750,000 x 5.5% = $206,250 for the year.
Worked example 3: $7,500,000 in wages.
No deductible amount.
$7,500,000 x 5.5% = $412,500 for the year.
Because you lose deduction as wages rise, each extra dollar of wages between $1 million and $7.5 million costs about 6.35 cents in payroll tax, not 5.5 cents. That is the 5.5% rate on the new dollar, plus 5.5% on the 2/13 of a dollar of deduction you lose.
Run your own figures in our payroll tax threshold calculator.
Most states apply a set of "relevant contract" provisions that treat many contractor payments as wages unless a listed exemption applies. Western Australia did not adopt those provisions.
In WA, payments to a contractor are taxable where the arrangement is, in substance, an employee and employer relationship.
In practice this means:
Our guide to payroll tax on contractors covers the rules in the other states. If you engage contractors in WA, keep the contract, the invoices and a short note of how the work is directed.
Related businesses are grouped for payroll tax, and a group shares one deductible amount. Grouping can arise from common ownership, common control or shared employees. See our payroll tax grouping guide for the tests.
If you pay wages in other states as well, the deductible amount is worked out on total Australian wages and then apportioned to WA. An employer with $7.5 million or more in Australian wages gets no deductible amount in WA, even if only a small part of that payroll is in WA.
Returns are generally monthly, due on the 7th of the following month. RevenueWA allows employers with smaller liabilities to move to a less frequent cycle. The annual reconciliation is due on 21 July and trues up the year.
Monthly returns use a monthly deductible amount based on that month's wages. Because the real deductible amount depends on full-year wages, a business that grows through the year will usually owe a balance at reconciliation. Reviewing year-to-date wages each month keeps that balance small.
Our outsourced payroll services cover WA registration, monthly returns and the annual reconciliation.
What is the payroll tax threshold in WA for 2026-27?
$1,000,000 a year. It diminishes as Australian wages rise above $1 million and is nil at $7.5 million.
What is the WA payroll tax rate?
5.5% for all employers.
How is the WA diminishing threshold calculated?
The deductible amount is $1,000,000 less 2/13 of your Australian taxable wages above $1,000,000.
Do I pay payroll tax in WA if my wages are under $1 million?
No, provided your total Australian wages, and your group's, are under the threshold.
Are contractors subject to payroll tax in WA?
They can be, where the arrangement is in substance an employment relationship. WA does not use the relevant contract provisions that apply in most other states.
When is WA payroll tax due?
Monthly returns are due on the 7th of the following month and the annual reconciliation is due 21 July.
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We review and check this guide periodically. At the time of writing (November 2026), all information was current. Scale Suite is a registered BAS Agent, not a licensed tax advisor or financial advisor. This content is general information only and does not constitute professional tax, financial, or legal advice. Some details may change over time.
Scale Suite is a Sydney-based provider of outsourced finance and HR services for Australian SMEs. We deliver bookkeeping, financial reporting, payroll processing, fractional CFO support, recruitment, employee onboarding, people and culture support, and fractional HR oversight, all as a fully embedded team that works inside your business.
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