It is important to understand your tax and super obligations as an employer, if you have provided rewards to employees for getting the COVID-19 vaccine.
Examples of incentives and rewards include:
- Cash payment
- Paid leave
- Transport to and from the vaccinations
- Vouchers and gift cards
If you have provided employees with cash payment, you must:
- Withhold tax from the payment amount under pay as you go withholding
- Include the payment in your employee’s salary/ wages
- Include the amount in your employee’s ordinary time earnings (This is to help determine super contributions by employer)
If you have provided paid leave, it will be treated like any other if the leave is granted to:
- Get a vaccination
- Recover from side effects
The payments received while on leave are treated as salary/ wages.
Non-cash benefits (vouchers or gift cards) may be reportable fringe benefits. These benefits will need to be included in your tax return. These may be used for:
- Determining your eligibility for certain government benefits and concessions, such as certain family assistance payments and tax offsets
- Determining your liabilities, such as Medicare levy
For any further information visit the Australian Taxation Offices website here.
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