Levy Payers

Levy Payer Information

Overview

The Scheme enables workers to qualify for long service leave based on their service with the construction industry rather than service with the one employer.

How is the Scheme funded?

The Scheme is funded through a levy imposed on eligible Northern Territory construction projects/works.

Who pays the levy?

The levy is payable by the person for whom the work is to be done, except where the work is to be done for the Australian Government or an interstate Government entity, in which case the principal contractor doing the work is liable to pay the levy.

What is construction work?

For the purposes of the Scheme, construction work includes commercial, domestic, industrial and civil construction, and covers (among other things) reclamation, earthmoving, landscaping, repair, maintenance, extension and demolition work.

For more information on the definition of construction work, click here or access the What is construction work? (PDF, 1.2MB) information sheet for levy payers.

Cost of Construction Work

For the purposes of the Scheme, the cost of construction work is “the total contract prices for all the construction contracts in relation to the work (the contract price for the work)”. The contract price for the work includes any applicable GST.

“Construction contract” includes contracts to:

• carry out construction work;
• supply goods relating to construction work to the site where the construction work is being carried out;
• provide, on or off site, professional services relating to the construction work; and
• provide on-site services relating to the construction work.

This covers contracts for the cost of labour, materials (including prefabricated goods and installation), equipment, design, project management, consultancy and other costs that relate to the work.

For more detailed information on goods, professional services and on-site services included in the definition of “construction contract”, please refer to the specific Levy Payer Information Sheets available on the “Resources” webpage.

How is the levy calculated?

The levy is calculated as a percentage of the cost of the construction work and is payable on all eligible construction projects.

The current levy rate on projects with a construction cost between $1 million and $5 billion is fixed at 0.1%, and is calculated in accordance with the following formula:

As the levy is payable prior to the start of construction work, the initial amount for calculating the levy payable is generally based on a payer’s self-assessment of the estimated total cost of the construction work. At the date of practical completion of the project, a reconciliation of the actual total cost of construction is required once the final cost is known, and may result in an additional levy or a refund, as the case may be.

A two tier levy mechanism applies for construction projects over $5 billion. Please refer to the specific Levy Payer Information Sheets available on the “Resources” webpage.

As part of NT Build’s internal audit program, construction projects may be subject to routine audit.

Exemptions Applicable

The levy does not apply to work:

• on single detached dwellings, including related private garages, carports and sheds;
• for which the total contract price for the construction work is less than $1 million in value; or
• undertaken for not-for-profit organisations in respect of voluntary labour or donated materials.

Notification of work

NT Build must be notified prior to the start of the upcoming construction work by submitting a Project Notification Form (PDF, 264KB). This includes notification by Principal contractors in the case of Commonwealth or interstate Government projects. The Project Notification Form can be emailed to info@ntbuild.com.au.

When is the levy to be paid?

The levy must be paid to NT Build before the construction work starts. As part of completing the Project Notification Form, the levy payer may apply to NT Build to pay the levy by instalments if the value of the levy exceeds the amount of $10,000 and the project is expected to take more than one year to complete Please refer to the specific Levy Payer Information Sheets available on the “Resources” webpage.

Construction Cost Reconciliation process

As the levy is payable in advance, the initial amount for calculating the levy payable is generally based on a payer’s self-assessment of the estimated total cost of the construction work. At the notified completion of construction works NT Build will forward a Reconciliation form to notify the actual total cost of construction.

If the total construction contract price is lower than the amount specified on the Project Notification Form, the levy payer will be entitled to a refund. If it is higher, the levy payer will be required to pay any additional levy amount.

Penalties for not paying the levy

Interest and fines may be imposed if the levy is not paid when due. The Act also grants NT Build the power to issue an order to stop work on the project until such time as the levy payer has met its statutory responsibility.

How to pay the levy

Following its receipt and consideration of the relevant Project Notification Form, NT Build will issue the levy payer with a tax invoice. Payment will be accepted by EFT (payments by cash or credit card are not accepted).

Variations to the prescribed levy rate over time

The prescribed levy rate may be subject to change from time to time, via Government regulatory amendment.

For further detail refer to Construction Industry Long Service Leave and Benefits Regulations.

Audits undertaken on construction projects

Payers should note that, as part of NT Build’s internal audit program, construction projects may be subject to routine audit.

Further information is available by contacting the NT Build office on 1300 795 855.