The requirement for medical centres to treat payments to medical practitioners as wages subject to payroll tax has been confirmed in the appeal in the Thomas and Naaz case.
The NSW Civil and Administrative Tribunal Appeal Panel’s decision this morning is yet another in the trend to treat the medical practitioner’s services as provided to the medical centre as well as the patient. Once again, the argument that the medical centre’s payments are simply an on-payment, from Medicare and the health funds, of the medical practitioner’s own monies has been dismissed.
The decision reinforces the treatment that is being applied by all revenue offices around Australia. It may encourage some to reactivate their medical centre audit programs with renewed vigour.
Revenue NSW is expected to shortly issue its foreshadowed Practice Note enforcing the decision. Based on the draft, that Practice Note is expected to rule that payroll tax is still payable even when a medical practitioner receives payment from Medicare and the health funds directly and makes a facilities services payment to their medical centre.
To find out how this decision may impact your medical practice or to discuss next steps you should consider, contact your usual Mazars advisor or alternately one of our experts via the form below or on:
Author: Stephen Baxter
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