Training Expenses Requirement
For most employer sponsored visas, the employer will be required to provide receipts of training expenses incurred for the last 12 months for staff in general including Australian citizens and permanent residents.
2 options are available:
- Training benchmark (A): If your business does not employ Australian citizen or permanent residents employee training expenditure must total at least 2% of the total payroll in the last 12 months. This can include payments/contributions made to an industry training fund
* If you do not have receipts to prove training expenses, you can contribute to an industry training fund. Ask our office for more info regarding a suitable training fund.
- Training benchmark (B): If your business employs Australian citizen or permanent residents, employee training expenditure must total at least 1% of the total payroll in the last 12 months.
Please note: if you cannot provide receipts to total 1% of the total payroll to meet training benchmark B, you also have the option to contribute 2% to an industry training fund to meet the training expenses requirement. Ask our office for more info regarding a suitable training fund.
Expenses can include the following:
* employment of apprentices, trainees or recent graduates
* conferences, seminars
* costs related to attending training
– travel and accommodation expenses
– facility/equipment hire
– printing or training material
* formal courses of study for employees at Australian educational institutions
* contribution to scholarship funds at Australian educational institutions
* employment of training officers
* hiring of external providers to deliver training
* structured – on-the-job training – must clearly identify increases in skills at each stage; cost of trainer’s salary can be counted; on-the-job training certificates including details of training can also be included
* HECS fees
* Training costs related to company owners and family members – only 40% of costs can be considered
Definition of payroll
Payroll includes all expenditure towards wages, remuneration, salary, commission, bonuses, allowances, superannuation contributions (mandatory or otherwise) including contractor wages or eligible termination payments that are defined as wages in the Act relating to payroll tax in the relevant State/Territory
Contractor Wages and Salaries
“For the purposes of the training benchmarks, irrespective of whether they are included for payroll tax purposes or not, payments made to contractors or sub-contractors should be included as payroll expenditure if the contractor provides some labour services in fulfilling the requirements of the contract and the labour provided relates to the service provided by the applicant’s business (that is, the contractor is a bricklayer and the applicant is a construction company). Payments made to contractors, such as an accountant or a migration agent, who provide a service to the applicant that is not directly related to the service the applicant provides to its customers should not be included as payroll expenditure. If payments to contractors are included as payroll expenditure, any eligible training expenditure in respect of the contractors may also be counted towards meeting the benchmarks”