Tax on Commissions & Bonus Payments
Does tax apply on commissions and bonuses paid to your staff?
The Australian Tax Office (ATO) has a great page that summarises when tax and super applies in neat easy-to read tables. Here we focus in 2 main payments that employers are often unsure about.
Bonuses
There is PAYG (Pay as you go) tax as well as super on bonuses which are still income for the employee.
Commissions
There is PAYG (Pay as you go) tax as well as super on commissions which are still income for the employee, like ordinary hours, see further down this table.
- For other payments such as allowances, expenses, paid leave and termination payments see the full detail of the tables on the ATO page to know when tax and super applies in neat easy-to read tables.
- For all the tax tables (can download a PDF version to keep on your PC desktop) see ATO Tax Tables page, there is also a link to the handy Tax Calculator they supply online.
- Contractors may require tax and super to be paid – be careful – See Contractor Checklist.
- For amounts/payment that you do not pay tax on, see Amounts you do not pay tax on.
- For Super calculations see ATO Superannuation guarantee contributions calculator
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