HR and payroll for accountancy practices in Australia
Reviewed by Mellow Editorial Team, HR & payroll content team
Running payroll for an accountancy practice in Australia follows the same legislative framework as any other employer — PAYG withholding, STP reporting, super, and the National Employment Standards — but the sector has its own staffing patterns, award coverage, and compliance pressures worth understanding clearly.
Award coverage and classification
Most employees in an accountancy practice will fall under the Clerks — Private Sector Award 2020. This covers administrative and clerical staff, graduate accountants, and bookkeepers. Senior accountants and those engaged in a professional capacity may be award-free if their annualised salary exceeds the high-income threshold, but you still need to confirm this, not assume it.
Graduate accountants are commonly classified at a level that reflects their qualifications and the nature of their work, not just their title. Misclassifying a graduate as a higher-level employee to avoid overtime obligations is a risk worth taking seriously — underpayment claims in professional services have attracted Fair Work scrutiny in recent years.
If your practice employs practice managers, IT staff or marketing staff, check whether those roles fall under a different award. It is not unusual for a small practice to have workers covered by two or three instruments.
Payroll mechanics: what the practice actually runs each period
For each pay event you need to:
- Calculate ordinary time earnings and apply the correct PAYG withholding using the current tax tables
- Deduct the Medicare levy at 2% (subject to low-income exemptions)
- Check for any HECS/HELP repayment obligations — common in an accountancy practice given the graduate-heavy workforce — and apply the correct banded withholding on top of income tax
- Calculate Superannuation Guarantee contributions at 12% of ordinary time earnings and pay these to the employee's nominated complying fund by the quarterly due date (or more frequently if your payroll system allows)
- Report the pay event to the ATO via Single Touch Payroll on or before the payment date
Annual leave accrues at four weeks per year under the National Employment Standards. If your practice has part-time or casual staff, their leave entitlements (or lack of them, in the case of casuals) need to be tracked correctly from day one.
The 14 July finalisation deadline
At the end of each financial year, you must finalise each employee's income statement in STP by 14 July. This replaces the old payment summary and allows employees to lodge their own tax returns without waiting on paperwork from you.
For an accountancy practice, this deadline is particularly pointed: your own clients will be pressing you to finalise their returns, and your staff will reasonably expect their income statements to be available promptly. Getting your internal payroll in order before the end-of-year rush — not during it — is practical advice worth taking.
For the 2025/26 finalisation, the deadline was 14 July 2026. If you are still working through that finalisation, it should be your immediate priority.
Contractor versus employee — a live issue in accountancy
Many practices engage contractors, especially for tax season overflow work or specialist advisory capacity. The ATO's multi-factor test and the expanded contractor vs employee rules mean you cannot rely on a written contractor agreement alone. Factors such as control over how work is done, use of your systems, and exclusivity of the relationship all weigh on the true nature of the engagement.
Getting this wrong has two consequences: underpaid super (because STP contractors may still be entitled to SG contributions) and potential back-payment of entitlements. If someone works predominantly for your practice, uses your software licences, and operates under your supervision, the engagement deserves a proper review.
Practices that use offshore contractors — for example, outsourced compliance work based overseas — face a different set of obligations again, including potential how Mellow runs payroll across six countries considerations if those workers are employed rather than genuinely independent.
Redundancy and restructuring
Accountancy practices go through mergers, technology-driven restructures (think AI-assisted compliance tools reducing junior workloads), and principal succession regularly. When roles are made redundant, the NES redundancy pay scale applies based on years of continuous service, starting from one week's pay after one year and scaling upward. Small business employers (fewer than 15 employees) are exempt from the NES redundancy scale, though they still owe notice.
If a restructure affects employees covered by the Clerks Award, consultation obligations under the award's change management clause are triggered before decisions are implemented, not after. Document the consultation process carefully — it matters if a dispute arises.
A final practical point: if the practice is merging with another firm, check whether continuous service carries over for the purposes of leave and redundancy entitlements. This is a common oversight during merger due diligence and can create unexpected liabilities for the acquiring entity.
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