Understanding the Fuss About Queensland Payroll Tax and Medical Centres

Last month, significant media coverage was dedicated to medical operators in Queensland now being subject to Queensland payroll tax on the patient fees remitted to practitioners who practice in the medical centres run by those operators.

 

And just last week, the Queensland Revenue Office (QRO) announced a proposed payroll tax amnesty, for existing General Practitioners (GPs) only, until FY 2025.

 

As always though, the devil is in the detail. Here is our snapshot of what medical operators in Queensland need to know moving forward into the future.

• The laws governing payroll tax in Queensland have not changed in respect of medical centres. All that has happened is that the QRO released a Public Ruling (PTAQ0006.1), on 22 December 2022, with its interpretation of how existing payroll tax laws apply to medical operators. Here is the link to the Public Ruling (PTAQ0006.1).

 

• This interpretation is yet to be tested in a Queensland court of law.

 

• Unsurprisingly, the interpretation casts a broad net which aims to capture most arrangements between practitioners and operators as contracts which are subject to payroll tax, especially arrangements whereby a practitioner is engaged to serve patients for or on behalf of the medical centre.

 

• Even if a medical centre only provides administrative services to practitioners (under service agreements), payroll tax may still apply if the medical centre exercises administrative or operational control over the practitioners’ operations.

 

• Given this interpretation, all medical operators should be engaging legal specialists in this area to conduct reviews of existing agreements with practitioners to determine exposure risk to Queensland payroll tax liability from FY 2022 onwards.

 

• At the bare minimum, medical operators should consider how they advertise the services provided by practitioners to the practitioners’ patients (and whether ownership of patients clearly rests with the practitioners). Medical operators also should aim to exert as little operational control as possible over practitioners.

 

The Macro Group can assist medical operators with engaging legal specialists to conduct reviews of existing agreements and if necessary, draft updated agreements for execution. Critically however, any agreements must reflect what is happening in practice, otherwise the QRO will look-through them.

 

Meanwhile, we await eagerly for further information to be released by QRO about what exactly is entailed in the proposed amnesty for GPs.

 

 

Please call or click to discuss with a Macro Group Team Member if you would like further information.

 

The Macro Group Team

 

Date: 21/09/2023

The Macro Group Limited AFSL:485843 Tax Agent Number 24 76 5236.The information in this article  contains general information only. We have not taken into consideration any of your personal objectives, financial situation or needs. Before taking any action, you should consider whether the general advice contained in this communication is appropriate to you having regard to your circumstances and needs, and seek appropriate professional advice if you think you need it. We recommend that you consult a licensed or authorised financial adviser if you require financial advice that takes into account your personal circumstances.