Re-employed apprentices or trainees

Wages paid to an out-of-trade apprentice or trainee may be exempt from payroll tax.

If you hire an out-of-trade apprentice or trainee, you do not automatically qualify for the exemption. You must satisfy the exemption requirements.

You do not need to apply for this exemption. If you are certain you meet the exemption requirements, you do not need to include those wages in your taxable wages on payroll tax returns.

Wages paid to apprentices and trainees hired through group training organisations may also be exempt.

Exemption requirements

The apprentice or trainee must:

• have been previously employed by another employer under a training contract under an approved training scheme
• now be employed by their current employer in the same apprenticeship or traineeship
• have started with their current employer under a training contract on or after 1 July 2016
• have left their previous employer before completing their apprenticeship or traineeship.

Also, the current employer must not be a member of a payroll tax group with the previous employer.

The apprentice or trainee must be re-employed under the same type of training contract.

Evidence

As an employer, you should record:

• the name of the re-employed apprentice or trainee
• the name of the previous employer
• start and end dates with the previous employer
• start date with you (the current employer)
• expected completion date of the apprenticeship or traineeship
• evidence of the approved training contract with the previous employer
• evidence of the approved training contract with you
• wages paid to the apprentice or trainee.