You’re considered a ‘working’ director if you’re performing work in the day-to-day operations of your business, which include administrative and management tasks.

You need to declare all payments to a working director including:

• allowances
• fees
• fringe benefits
• salary
• superannuation and  
• wages.

Where a company’s constitution allows for a dividend, these are not normally counted as remuneration, unless these payments are in lieu of wages. If you’re receiving dividends in lieu of payments, the amount to be included in your wage declaration depends on:

• the hours worked and
• the type of work performed, comparing that to a comparable remuneration rate in the market.

These can be determined through awards, job ads or, where these are not applicable, using ABS data.

The remuneration amount may be above an award, if the duties of the working director exceed what a worker would be required to do under the award being considered, for example, making financial and / or business decisions.

Workers compensation legislation does not rely on the tax status of the person carrying out the work to determine whether that person is deemed a worker or contractor.

If you have a locum or contractor working for you on:

• consistent hours or days
• wears your uniform and
• holds an ABN

they’re likely to be deemed an Employee, if they don’t hold their own cover.

Their wages should then be included in your declared wages.

SIRA, the NSW workers compensation regulator, have a tool to help you determine whether someone performing duties in your business is a worker or contractor which you can find here.

Ask to see the workers Certificate of Currency to show that they have their own Workers Compensation insurance in the name of the entity that you are paying.

Guild Insurance conducts wage checks to ensure wages have been appropriately declared. If there is a discrepancy, not only will we collect the additional premium, we can also apply an interest charge to the outstanding debt dating back to when it was due. We will also review prior years to confirm the same discrepancy doesn’t exist to those years as well.