A public ruling, when issued, is the published view of the Commissioner of State Revenue (the Commissioner) on the particular topic to which it relates. It therefore replaces and overrides any existing private rulings, memoranda, manuals and advice provided by the Commissioner in respect of the issue(s) it addresses.
Where a change in legislation or case law (the law) affects the content of a public ruling, the change in the law overrides the public ruling—that is, the Commissioner will determine the tax liability or eligibility for a concession, grant or exemption, as the case may be, in accordance with the law.
A diving school operator on the Great Barrier Reef engages a number of contract diving instructors each year for 120 days during the tourist season. The business has no requirement for the services of diving instructors outside of the season. Section 13B(2)(b)(ii) of the Payroll Tax Act is satisfied in this situation as the services are required for less than 180 days in a financial year.
Consequently, the contracts that the diving instructors entered into with the diving school operator are not ‘relevant contracts’. Accordingly, payments made to the contract instructors are not subject to payroll tax even if each instructor has worked more than 90 days in a particular financial year.
A building company engages the services of a contract landscape gardener (Landscaper A) to perform landscaping services for 100 days in a financial year. A second contract landscape gardener (Landscaper B) is engaged to perform the same services concurrently for 95 days. No other landscaping work is required by this building company for the rest of the financial year.
As the building company only requires landscaping services for 100 days in the financial year, s.13B(2)(b)(ii) of the Payroll Tax Act is satisfied. Accordingly, both contracts with Landscaper A and Landscaper B are not ‘relevant contracts’ and payments made under both contracts are not subject to payroll tax.
On the other hand, if Landscaper B performed the 95 days of service after Landscaper A has completed his 100 days of service, the exemption in s.13B(2)(b)(ii) of the Payroll Tax Act does not apply because the total number of days that the building company requires landscaping services is 195 (100 days + 95 days). As a result, contracts entered into with Landscaper A and Landscaper B are ‘relevant contracts’ under s.13B of the Payroll Tax Act and payments made under these contracts are subject to payroll tax, unless one of the other exemptions under the contractor provisions applies.
Commissioner of State Revenue
Date of issue: 3 July 2009
|Public Ruling||Issued||Dates of effect|
|PTA020.2||3 July 2009||3 July 2009||Current|
|PTA020.1||24 February 2009||1 July 2008||2 July 2009|