2006

 June, 2006

Self Employed Contribution Rate & Interest Rate                    2006-2007

In June 2006 the Board set both the interest rate and contribution rate that will be applied to the self employed worker for the next financial year as follows:

The interest rate for the 2006-2007 financial year will be 10.6%.

The contribution rate (the rate at which a self employed person can contribute into the scheme) remains at $156.00 per quarter for the 2006-2007 financial year (this rate is based on a weekly wage of $720.00 per week.) However, the self employed worker will now have the option of choosing to contribute at a higher rate of $182.00 per quarter if they so wish (this rate is based on a weekly wage of $840.00 per week.)

Important Reminder 

EMPLOYERS CONTRIBUTION RATE LOWERED

WORKERS BENEFITS INCREASED

Effective From Your July 2006 Return

As an employer within the industry, when you submit your returns on time and then subsequently pay your tax invoices on time you will be offered a subsidised rate of 0.3%. This is a substantial lowering of the current subsidised rate of 0.7% that is offered in these circumstances at present. You are urged to submit your returns on time and pay your invoices on time to avail yourselves of this heavily subsidised rate.

Correspondence clearly indicates due dates, if these dates are not met, returns and invoices are recalculated to the full rate of long service leave automatically. The Full Rate of Long Service Leave is 1/60th (or approximately 1.667%) of an ordinary weekly wage to accrue 13 weeks paid leave after 15 years of service. In line with these changes to the fund, as detailed below, the cost of long service leave from your July 2006 return increases to 1/40th (or 2.5%).

Please be aware that from your July 2006 return if you do not submit your returns on time and do not pay your tax invoices on time the rate will be recalculated automatically up to 2.5%.

Effective from Your January 2006 Return

Pre January 2006 workers in the construction industry accrued 13 weeks paid leave after 15 years of service in the industry. Effective from your January, 2006 return workers commenced accruing 13 weeks leave after 10 years of service. Current benefits were not converted. Workers in effect, as from the January return, started accruing leave quicker.

Pro-rata entitlements under certain circumstances will be offered after 7 years of service, this remains unchanged. However, pro-rata entitlements on death (minimum 55 days service) and retirement or permanent disability (minimum 2 years service) have been introduced from 1 January 2006.

Should you require further information please do not hesitate to contact us.

Who is a worker and who is a subcontractor?

Q: Do I have to contribute for a labour only subcontractor?
A: Yes, there is no such thing as a labour only subcontractor. For the purposes of this legislation and the Australian Taxation Office the labour-only worker is deemed to be an employee.

Q: How do I work out who is a worker and who is a subcontractor?
A: There are several avenues to seek advice. We advise employers to contact their employer organisations or accountants.

The Australian Taxation Office has an excellent question and answer tool to help you, it is called the Building & Construction Industry Employee/Contractor Decision Tool and you can find it online at www.ato.gov.au

Just follow the links to Rates, Calculators & Tools, Businesses,  Tools, Building & Construction Industry Employee/Contractor Decision Tool. 

Questions asked include such things as: Is the worker free to work for a number of clients or just for you? Do you pay their superannuation, redundancy payments, sick leave etc? Does the worker work their own hours or hours determined by you? Does the worker take on a financial risk with the work? Is the worker paid per job or per week/fortnight? They are examples only and a number of different criteria will be used to determine the workers capacity.

Q: What happens if I send workers interstate or overseas to work?
A: Interstate work can count, but not overseas. If you are a Tasmanian employer who employs workers in another State for short periods, you may apply to the long service authority in that state or territory for an exemption from their long service coverage provided that you continue to record the workers service under TasBuild. For extended working periods the interstate scheme may demand that you register and contribute into their scheme for those particular workers for that project.

2005 News & Info

2004 News & Info

2003 News & Info

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