Levy Payer FAQs
The Scheme is statute based and is funded through a Ministerially determined levy on eligible Northern Territory construction projects of at least $1 million in value. For projects that commenced on or after 7 April 2014, with a construction cost between $1 million and $5 billion, the prescribed levy rate is 0.1%.
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. The prescribed rate of 0.1% applies to the first $5 billion, and is payable prior to the start of construction work. A project specific levy determined by the relevant Minister, after consideration of a report prepared by the Scheme actuary, applies to the project cost component that exceeds $5 billion. The project specific levy component is payable following completion of the project.
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.
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 (effective from 7 April 2014) or $200,000 in value for projects started before 7 April 2014; or
- undertaken for not-for-profit organisations in respect of voluntary labour or donated materials.
For the purposes of the Scheme, the cost of construction work is identified as being “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 Information Sheets available on the “Publications” webpage.
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 detailed information on the definition of “construction work”, please refer to the “What is construction work?” Information Sheet.
The levy must be paid to NT Build before construction work starts.
Yes, with NT Build Board approval.
As part of completing the relevant 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. As a general rule, the first instalment should be not less than 50% of the total levy amount due, with the balance to be paid in two equal further instalments.
NT Build may approve or refuse a levy instalment application, or decide to vary its terms.
If a levy payer fails to pay an instalment in accordance with an approved instalment plan, the approval will cease to have effect and the amount of the levy that remains unpaid will become immediately payable, start to bear interest and be recoverable in a court of competent jurisdiction. The amount recoverable may also include any costs associated with the recovery of the unpaid levy amount.
On completion of the project, once the final total contract price is known, the levy payer is required to submit a Project Reconciliation Form. NT build will send the levy payer this form on or around the anticipated project completion date, as specified by the levy payer on the Project Notification Form. 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.
As illustrated by the following formula, the levy payment itself does not have GST applied to it. However, any GST applied to the contract prices that make up the total cost for the particular construction works, is included when calculating the leviable amount.
For more information on how to calculate the levy and how to determine the cost of the particular construction works please refer to the specific Levy Payer Information Sheets available on the "Publications" webpage.
NT Build can order the work to stop. Interest can be charged on late payments. NT Build can prosecute for failure to pay the levy or failure to comply with notices to stop work.
Yes. The NT Government must pay the levy for work done for agencies or Government Owned Corporations such as the Department of Infrastructure Planning and Logistics and Power Water Corporation.