NSW payroll tax changes safeguard essential GP veteran care
The NSW government has been applauded for amending payroll tax rules to ensure veterans have ongoing access to essential general practice care.
The Royal Australian College of GPs (RACGP) revealed it was pleased with the NSW government's decision to amend the payroll tax rules to ensure ongoing access to essential GP care for veterans with a gold, white or orange department of veterans (DVA) card.
The bill to abolish payroll tax on the care veterans receive from independent GPs in NSW was passed last week by the Parliament of New South Wales.
RACGP NSW & ACT chair, Rebekah Hoffman, said she applauded the Minns labor government for acting on calls to amend payroll tax for independent GPs caring for veterans.
“GPs told us it had become financially unviable to provide care to veterans after NSW introduced payroll tax on independent GPs this year,” Hoffman said.
“Veterans usually receive bulk billed care from GPs, but their DVA rebates don’t cover the full costs of providing their care.”
“The extra payroll tax impost on top of this was unsustainable- putting access to essential healthcare for veterans at risk.”
According to RACGP, the expansion of NSW’s Bulk Billing Support Initiative meant services billed to veterans would count towards the threshold needed to benefit from the payroll tax rebate.
RACGP said it applied “retrospectively” from 4 September 2024.
General practices had always paid payroll tax on its employees, including receptionists, GPs in training and nurses; however, never applied to GPs as most work under independent agreements.
RACGP noted the tax change followed a final ruling by the NSW Court of Appeal in 2023 which deemed independent practitioners as employees for payroll tax purposes.
However, in June this year the NSW government agreed to no retrospective tax and an exemption tied to general practices that met bulk billing thresholds.
This was agreed to following “strong warnings” from the RACGP that it would result in widespread practice bankruptcies and closures.
As previously reported in Accountants Daily, the NSW government gave payroll tax rebates to GP clinics, being the first state in Australia to issue a full retrospective waiver for past liabilities.
The Bulk Billing Support Initiative was initially expected to end the uncertainty over the applicability of payroll tax on contractor GPs and reduce financial pressures on patients and practices.
Hoffman said protecting affordable healthcare for veterans was something that needed to be taken seriously.
“These changes ensure ongoing access to essential GP care for veterans in NSW, and that the GPS and practices providing this care can do so sustainably.”
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