QLD Payroll Tax Calculator 2025-26 (Mental Health Levy)

How QLD payroll tax works in 2025-26

Queensland payroll tax is the state tax that the Queensland Revenue Office (QRO) charges on the wages an employer (or a group of related employers) pays for work performed in Queensland. Like the other states, it is paid by the employer out of the business — it is not deducted from the employee's pay packet. The 2025-26 Queensland payroll tax year runs 1 July 2025 – 30 June 2026, with monthly returns generally lodged through QRO Online and an annual return submitted at the end of the financial year.

Four design choices shape the Queensland bill for 2025-26:

1. A $1.3 million tax-free threshold, set at the per-group annual level rather than per entity.
2. Two standard rates based on the size of the group — 4.75% for groups with Australian taxable wages of $6.5 million or less, and 4.95% for groups above that line.
3. A 1 percentage point regional employer discount that drops the standard rate to 3.75% or 3.95% depending on the wage band.
4. A Mental Health Levy — a separate surcharge that layers on top of the standard tax for groups with Australian taxable wages above $10 million, with a higher tier above $100 million.

This calculator estimates the standard rate plus the Mental Health Levy for a single employer or simple group. It does not model every possible exemption, rebate or contractor inclusion provision; for those edge cases the QRO Online assessment is the source of truth.

The $1.3 million threshold and rates

From 1 July 2025 the annual Queensland payroll tax threshold is $1,300,000, with an equivalent monthly threshold of about $108,333. QRO charges payroll tax only on the portion of taxable Queensland wages above the threshold, so an employer paying $1.5 million of QLD wages with no interstate operations is taxed on the $200,000 above the threshold rather than the full $1.5 million.

The rate depends on the group's total Australian taxable wages, not just QLD wages:

Group Australian wages	Standard rate	Regional employer rate (−1pp)
$1.3m – $6.5m	4.75%	3.75%
above $6.5m	4.95%	3.95%

Two important notes on the threshold:

• It is a per-group annual figure. Where two or more entities are grouped under the harmonised payroll tax grouping rules — for example, common control or common employees — the $1.3 million threshold is shared once across the whole group, not granted to each entity separately.
• It is reduced by interstate apportionment. Once your group operates in more than one Australian state, the usable Queensland threshold is smaller than the headline $1.3 million figure.

The Mental Health Levy ($10m / $100m tiers)

The Mental Health Levy is an additional payroll tax that QRO charges on top of the standard rate for the largest Queensland employers. It is set on the group's total Australian taxable wages and then attributed to QLD by the QLD share. Two tiers apply:

• Australian wages of $10 million or less → no levy.
• Australian wages between $10 million and $100 million → 0.25% on the slice above $10 million.
• Australian wages above $100 million → 0.5% on the slice above $100 million, plus 0.25% on the full $90 million in the lower band.

A $50 million national employer therefore pays a levy of ($50m − $10m) × 0.25% = $100,000 before apportionment, while a $120 million national employer pays $90m × 0.25% + $20m × 0.5% = $325,000. Where the group operates in more than one state, only the QLD share of that levy is reported on the Queensland return — the rest is picked up (or not) under each state's own framework.

Regional employer 1% discount

Queensland gives a 1 percentage point discount on the standard rate to eligible regional employers. To qualify in 2025-26, both of the following must broadly hold:

• The employer's principal place of business is in regional Queensland; and
• At least 85% of the employer's Queensland taxable wages are paid to employees who work mainly in regional Queensland.

The effect:

• A smaller regional employer (group Australian wages ≤ $6.5m) pays 3.75% instead of 4.75%.
• A larger regional employer (group Australian wages above $6.5m) pays 3.95% instead of 4.95%.

The regional discount applies to the standard rate only. It does not reduce the Mental Health Levy — a regional employer above $10 million still pays the levy on the same basis as a metropolitan employer.

Interstate wages apportionment

Queensland payroll tax is calculated on Queensland wages, but the threshold is shared across Australia. Where an employer (or a group of related employers) pays wages in more than one Australian state or territory, QRO reduces the Queensland threshold in proportion to the QLD share of total Australian wages:

Threshold after apportionment = $1,300,000 × (QLD wages ÷ total Australian wages).

For example, an employer with $1,000,000 of Queensland wages and $5,000,000 of total Australian wages is given only one fifth of the headline threshold ($260,000) before tax is calculated. Wages paid wholly outside Queensland are not subject to Queensland payroll tax in their own right, but they still feed into the apportionment fraction.

The same QLD share is used to attribute the Mental Health Levy to the Queensland return — it would otherwise be possible to count the full levy in every state, which is not how the harmonised framework is designed to work.

Grouping rules

Where two or more entities are connected — by common control, common employees or by being part of the same corporate group — QRO treats them as a single employer for payroll tax purposes. The implications:

• The $1.3 million threshold is shared once across the whole group, not granted to each entity.
• Total Australian wages are aggregated across the group when running the $6.5m large-employer test and the Mental Health Levy bands.
• A designated group employer (DGE) is generally nominated to claim the threshold and lodge on behalf of the group; other group members lodge against the leftover share.

Aggregating wages incorrectly across a group can produce a bill that is materially wrong in either direction — checking the grouping position before lodgement is one of the highest-leverage moves an employer with related entities can make.

Worked examples

1. Brisbane mid-sized employer. A Brisbane-based business pays $2,000,000 of Queensland wages with no interstate operations. The threshold is the full $1,300,000. Taxable QLD wages = $700,000. The group sits below $6.5m of Australian wages so the small-metro 4.75% rate applies. The typical bill is around $33,250 for the year, or about $2,771 a month. There is no Mental Health Levy because Australian wages are below $10 million.

2. Cairns regional employer. A regional Queensland employer (≥ 85% regional wages and a regional QLD principal place of business) pays $5,000,000 of QLD wages with no interstate operations. The group sits below $6.5m so the small-regional 3.75% rate applies. Taxable QLD wages = $5m − $1.3m = $3,700,000 → tax = $3,700,000 × 3.75% = approximately $138,750 for the year, or about $11,563 a month. The same wages under the standard 4.75% rate would have produced approximately $175,750 — the regional discount is worth about $37,000 a year at this scale.

3. National chain in MHL band 2. A national group pays $120,000,000 of Queensland wages and $120,000,000 of total Australian wages (Queensland is the principal state). Threshold = $1,300,000, taxable = $118,700,000, large-employer rate = 4.95% → base tax ≈ $5,875,650. Mental Health Levy on total Australian wages = $90m × 0.25% + $20m × 0.5% = $325,000, fully attributed to QLD because the QLD share is 100%. Total estimated annual liability is approximately $6,200,650, or about $516,721 a month.

QLD vs VIC vs NSW payroll tax comparison

For employers weighing which state to expand into, three numbers usually decide the order:

State	Standard threshold	Top standard rate	Surcharge for very large employers
QLD	$1.3m	4.75% / 4.95% above $6.5m	Mental Health Levy: 0.25% above $10m, 0.5% above $100m
VIC	$1.0m	4.85% / 4.95% regional	COVID-19 debt levy on largest employers (separate calculation)
NSW	$1.2m	5.45%	Mental Health and Wellbeing Levy on the largest employers

Compare the all-in annual bill at the actual wage profile rather than the headline rate. A regional Queensland employer with predominantly regional staff often has the lowest effective rate of the three states; a $50m+ national employer normally finds NSW the highest.

Lodgement and due dates (QRO Online)

Most Queensland employers lodge and pay payroll tax monthly through QRO Online, the QRO online portal:

• Monthly returns: generally due by the 7th of the following month. Each monthly return self-assesses payroll tax against one-twelfth of the apportioned threshold.
• Annual return: due by 21 July, covering the financial year just ended. The annual return re-runs the calculation at year-end with the actual full-year apportionment, rate band and Mental Health Levy.
• Smaller employers under set monthly-wage thresholds may be eligible for a periodic (rather than monthly) return. Eligibility is confirmed on registration with QRO.

The figure produced by this calculator is an annualised estimate assuming wages are spread evenly across the year. Actual monthly instalments and end-of-year reconciliation depend on the wage pattern, group structure, regional status and any rebates applied.

Common pitfalls

• Forgetting that the threshold is shared across Australia. A national employer who plugs only Queensland wages into the threshold (without entering total Australian wages) will overstate the tax-free amount and understate the bill.
• Applying the regional discount to the Mental Health Levy. The 1pp regional discount only applies to the standard rate. The Mental Health Levy is charged at the full 0.25% / 0.5% regardless of regional status.
• Confusing the $6.5m large-employer test with QLD wages alone. The 4.95% rate is triggered by total Australian wages above $6.5m, not Queensland wages on their own. A QLD-only employer at $7m of QLD wages is in the higher band; a national group with $4m of QLD wages and $4m of NSW wages is also in the higher band.
• Ignoring grouping rules. Two entities under common control share a single $1.3 million threshold and a single set of MHL bands, not two of each.
• Confusing PAYG and payroll tax. PAYG withholding is deducted from the employee's pay and remitted to the ATO. Payroll tax is an employer-paid state tax assessed on the gross wage bill — they are independent obligations.

When to talk to a professional

This calculator gives a general estimate based on QRO's published 2025-26 threshold, rates and Mental Health Levy. Binding assessments — especially involving complex group structures, contractor inclusion tests, employment agency provisions, exemptions, partial-year operations or Mental Health Levy attribution between states — should go through a Queensland-registered tax agent or payroll specialist. For your exact assessment, contact QRO or use QRO Online. Nothing on this page is personal tax, legal or financial advice.

Related calculators

• VIC Payroll Tax Calculator — Victorian payroll tax with the $1m threshold and the $3m–$5m phase-out.
• QLD Land Tax Calculator — Queensland land tax with the absentee surcharge.
• QLD Stamp Duty Calculator — Queensland transfer duty for owner-occupiers and investors.
• Salary Sacrifice Super Calculator — model the effect of pre-tax super contributions on take-home pay.
• HECS-HELP Repayment Calculator — annual HECS-HELP repayment by income.

Sources:

• QRO — Calculate payroll tax
• QRO — Payroll tax rates and thresholds
• QRO — Payroll tax calculators
• Business Queensland — Payroll tax
• Payroll Tax Australia — Resources