Regional payroll tax rates: Victoria 1.2125% and the Queensland 1% discount

Regional Victoria means 48 regional councils, from Alpine Shire to Yarriambiack Shire (including Ballarat, Greater Bendigo, Greater Geelong, Latrobe, Mildura, Warrnambool and Wodonga), plus the six alpine resorts of Mt Baw Baw, Mt Buller, Mt Hotham, Mt Stirling, Falls Creek and Lake Mountain. Only work done in Victoria counts: an employee who spends 60% of a month interstate, 10% in Melbourne and 30% in regional Victoria spent 75% of their Victorian time in regional Victoria, so is a regional employee.^[1]

If you meet the 85% rule for the year but not every month, you pay 4.85% in those months and get a refund in the annual reconciliation.^[1]

Regional Queensland is defined by seven ABS statistical areas (SA4): Cairns, Central Queensland, Darling Downs – Maranoa, Mackay – Isaac – Whitsunday, Queensland – Outback, Townsville and Wide Bay. Short-term residents such as working holiday makers and PALM scheme workers generally do not have their principal place of residence there.^[2]

On 11 November 2026 QRO announced a temporary amnesty, until 31 December 2026, for certain employers who incorrectly claimed the discount.^[4]

Alpine Shire, Ararat Rural City, Ballarat City, Bass Coast Shire, Baw Baw Shire, Benalla Rural City, Buloke Shire, Campaspe Shire, Central Goldfields Shire, Colac Otway Shire, Corangamite Shire, East Gippsland Shire, Gannawarra Shire, Glenelg Shire, Golden Plains Shire, Greater Bendigo City, Greater Geelong City, Greater Shepparton City, Hepburn Shire, Hindmarsh Shire, Horsham Rural City, Indigo Shire, Latrobe City, Loddon Shire, Macedon Ranges Shire, Mansfield Shire, Mildura Rural City, Mitchell Shire, Moira Shire, Moorabool Shire, Mount Alexander Shire, Moyne Shire, Murrindindi Shire, Northern Grampians Shire, Pyrenees Shire, Borough of Queenscliffe, South Gippsland Shire, Southern Grampians Shire, Strathbogie Shire, Surf Coast Shire, Swan Hill Rural City, Towong Shire, Wangaratta Rural City, Warrnambool City, Wellington Shire, West Wimmera Shire, Wodonga City, Yarriambiack Shire. The six alpine resorts (Mt Baw Baw, Mt Buller, Mt Hotham, Mt Stirling, Falls Creek and Lake Mountain) also count.^[1]

The SRO's own example: in 2024-25 RedCar paid $100,000 of Victorian taxable wages every month ($1,200,000 for the year). Its regional employees received $90,000 a month from July to October and from March to June, but only $80,000 a month from November to February. In those four months it was below 85%, so its monthly returns used 4.85%; in the other eight months it used 1.2125%. Over the year it paid $1,040,000 to regional employees, 86.67% of its wages, so the annual reconciliation applied 1.2125% to the whole year and refunded the overpaid tax for November to February.^[1]

Groups that lodge a joint (schedule) return split the taxable amount: the share of wages paid by regional members is taxed at 1.2125% and the rest at 4.85%. In the SRO example, three grouped businesses paid $90,000 in July 2024 against a $75,000 monthly threshold; one third of the wages came from a regional member, so $5,000 of the $15,000 taxable amount was taxed at 1.2125% and $10,000 at 4.85%.^[1] For a joint return, enter only the group totals in our calculator and work the split out by hand.

An employee's principal place of residence is where they usually live, judged on facts such as whether they live there daily, where their belongings and immediate family are, how long they have lived there, their mail and electoral roll address, the address on their driver licence and whose name the utility accounts are in.^[2]

Your principal place of employment is your registered ABN business address on the Australian Business Register; without an ABN, your principal place of business.^[2]

In a group, each member is tested on its own: in QRO's example, two companies grouped with $7 million of Australian wages pay 3.95% (the regional member) and 4.95% (the member that is not regional).^[2]

The discount stops above $350 million of wages. QRO's page describes the cap as Australian taxable wages; the Payroll Tax Act 1971, s 10A(4), refers to the taxable wages paid by the employer during the return period. Our calculator applies the cap to total Australian wages and says so; if your Queensland wages alone are under $350 million but your Australian wages are above it, ask QRO.^[2],[5]