An update – Victorian payroll tax on non-government schools

In our June 2023 article (see here) we expressed surprise with the decision of the Victorian Government to impose payroll tax (‘PRT’ ) on certain non-government schools.

Despite significant lobbying the legislation has now been passed by the Parliament, although a concession has been made to increase the fee threshold at which a school will cease to be exempt.

PRT exemption will now be limited to non-Government schools that have income per student of $15,ooo or less.

The Government announcement of the increased threshold and treatment of individual schools was released on 29 June 2023.

A listing of schools that will retain exemption can be viewed here.

A listing of schools that will be subject to PRT can be viewed here.

The calculation of income per student is set out below.

To determine income per student, the department uses the Commonwealth Department of Education’s Financial Questionnaire (FQ). The questionnaire requires schools to provide the following information:

  • Fees and Charges (excluding Overseas Students)- Tuition (System & Diocese funding included)
  • Income from Excursion State/Territory Government trips – Tuition (System & Diocese funding included)
  • Other Receipts from Students – Tuition (System & Diocese funding included)
  • Fee/levies Allocated for Capital Purposes – Tuition (System & Diocese funding included)

The assessment of income takes into account fees, charges, compulsory levies and other income, as well as fee reductions for scholarships and other financial relief to families in financial difficulty.

Income relating to overseas students has been excluded on the basis that these students do not receive funding from either the Commonwealth or through the state’s Financial Assistance Model (FAM).

Additionally, schools that operate kindergartens or day care centres are required to separate out fees from these services, therefore fee income from these centres is not assessed. The fee income in relation to school students only was used for assessment purposes.

The basis of the determination used FQ data submitted at each of the specified categories for the 2021 reporting period and the 2021 funded enrolments were used to derive the per capita.

The following sets out the calculation:

  • Sum of income recorded for each of the categories listed above for the 2021 reporting divided by funded enrolments.


  • Total FQ categories used for determination = $5,500,000 / 500 enrolments (based on 2021 funded enrolments) = $11,000 income per student.

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