Mercans CountryIntel ® Australia Payroll And HR Insights
Australia offers a business-friendly environment that is stable, low-risk and dynamic. A great investment destination, Australia maintains strong trading relationships with major markets around the world which helps it expand its global presence. A service-based economy, Australia’s exports are underpinned by five key industries: resources, energy, agriculture, tourism and education.Download PDF
Australia’s strong economic fundamentals and its location within the Asia Pacific provides a wealth of opportunities. This is supported by a robust economic, legal and regulatory framework. Additionally, the state and territory governments provide a range of support and tools to assist investors to set up and run their business in Australia. Such support may range from grants, employee training, R&D tax incentives, project facilitation and more.
Entity Registration and Incorporation Requirements
Setting up a new business or expanding an existing one in Australia is straightforward. Choose how your company operates from a range of entity types which suit your individual circumstance.
Banking Hours: 9.30 am to 4:00 pm from Monday to Thursday
The standard working week is from Monday to Friday from 7:00 am - 4:30 pm
Australian labor law has a dual structure whereby some employment issues are governed by the Federal government and others may be governed by state and territory laws. The primary statute regulating labor is the Workplace Relations Act 1996. Australian courts, both State and Federal, interpret legislation but also apply the common law. The central elements of Australia’s employment system includes a set of national standards of employment for all Australian employees, occupational health and safety regulations and superannuation (pension) payments.
Finance, Business Consulting, Metals & Mining, Energy & Utilities, Healthcare
Dates & Numbers
Official State Name
The Federation of Australia
International Dialing Code
Organizations who operate multi-county payroll should be aware that Single Touch Payroll (STP) is applied in Australia. STP streamlines the way employers report tax and superannuation information to the Australia Taxation Office (ATO). It simplifies administration for employers, wherein reporting aligned with business processes such as payroll cycles. Companies will also likely need to register for payroll withholding before beginning to pay employees (this is referred to as Pay As You Go PAYG). Payroll tax is the tax businesses are required to pay on payroll and is applied according to thresholds related to weekly payroll expenses. Payroll tax rates are also entirely dependent on state requirements.
It is acceptable to provide employees with online payslips
Payroll reports must be kept for 7 years
Employees receive paid annual leave of 30 days
Employees receive paid sick leave of 10 days
12 months of unpaid maternity leave and 5 days of unpaid paternity leave
Maternity & Paternity Leave
There are no provisions mandated by law regarding the 13th month salary
13th month salary
20.33 AUD per hour
Overtime payment of 1.5x the employee's ordinary rate of pay for the first 3 hours of overtime
Employees paid monthly are entitled to 15 days’ pay for each year of employment for the first five years of service
Most major business taxes such as income tax are collected by the government through the Australian Taxation Office (ATO). In some cases, state-based taxes also apply, commonly for payroll tax. Centrelink social security payments and services are delivered to Australians by Services Australia, who is responsible for the delivery of accessible social, health and child support services and payments.
Australia holds a number of tax treaties with more than 40 countries to prevent double taxation of foreign entities operating in Australia.
Corporate Income Tax
Personal Income Tax
The social security system provides individuals with a minimum adequate standard of living and the transfers are income support payments and payments to families including age and other pensions. Concession cards provide additional assistance.
Social Security Rate
Social Security Rate for Employers
Social Security Rate for Employees
Employment laws apply to foreign nationals who are employees based in Australia, regardless of whether the employer is based in Australia or overseas. Employment laws apply to nationals based in Australia and in some circumstances, the laws may also apply where the employee is engaged in Australia but performing work for an Australian employer abroad.
The employment relationship is primarily governed by the law of contract under Australian law but there is no statutory requirement to enter a written employment contract. Collective agreements (also known as enterprise agreements in Australia) can also be made under the Fair Work Act.
The National Employment Standards (NES) provides for a maximum of 38 hours unless the additional hours are reasonable (it is common for employers and employees to agree on what this means). Enterprise agreements typically contain provisions that regulate the hours of work.
Under the NES, full-time employees are entitled to four weeks of paid annual leave per year. Casual employees are not entitled to annual leave. Additionally, employers can require employees to take paid annual leave in some circumstances.
Employees must be provided with the minimum statutory notice period and if permitted by their employment contract, a payment may be made in lieu of notice.
Minimum notice period for terminating an employee
Total number of public holidays
Working hours per week
Total number of days for Compassionate & Bereavement Leave
Individuals working in Australia require a visa that suits the work that they intend to do. Various visas are available to address regional migration, permanent work, temporary work, short stays, skilled occupation and visa for innovation.
There is a number of different permanent work visas available including regional visas for skilled migrants to live and work in regional Australia, skilled migration visas, business investment visas as well as Global Talent visas (for those who have an internationally recognised record of exceptional and outstanding achievement in an eligible field).
Work Permit validity
Records of a completed medical examination
Written confirmation that character requirements are met
Demonstration of competent English proficiency
Possess three years of relevant work experience
Aged 45 years or less
Confirmation that the individual has read or been given an explanation of the Life in Australia booklet
Signed the Australian Values Statement
Build the best team and hire top talent compliantly in Australia. Get in touch with Australia payroll outsourcing & PEO specialists for a free consultation!