The general practice sector in Australia has faced significant challenges in recent years, with cost pressures, GP shortages, and increasing patient demand all contributing to uncertainty.

But a landmark decision in Queensland may provide both relief for doctors and opportunity for business owners.

The Crisafulli Government’s payroll tax exemption for specialist GPs has been welcomed by the Royal Australian College of General Practitioners (RACGP) as a game-changer.

Beyond improving patient access to healthcare, this policy shift is set to strengthen the financial viability of general practices and increase demand from buyers.

What Has Changed?

Historically, payroll tax applied to practice employees such as nurses and receptionists, but not to GPs who worked as independent contractors.

This changed after a 2023 ruling by the NSW Court of Appeal, which deemed independent practitioners to be employees for payroll tax purposes.

The implications were significant: many practices faced unexpected tax bills, retrospective liabilities, and the risk of closure.

Queensland was the first state to respond, first by offering an amnesty and now by legislating an exemption for GPs through the Revenue Legislation Amendment Bill 2024.

Under the new exemption, patients’ fees paid directly to a GP for their services will not be subject to payroll tax, restoring certainty to practice owners.

Why This Is Good News for General Practice Sales

For potential buyers, the removal of payroll tax risk makes general practices far more attractive investments.

Here’s why:

  • Greater Financial Certainty: With payroll tax clarified, buyers can assess practices with confidence, knowing profit margins will not be eroded by unexpected liabilities.
  • Improved Business Valuations: Predictable revenue streams increase the multiple buyers are willing to pay, supporting stronger sale prices.
  • Reduced Risk of Closure: Practices are more likely to remain viable, particularly in regional and suburban areas where margins are tighter.
  • Stronger Buyer Demand: Corporate groups, private investors, and overseas buyers all value regulatory clarity. The exemption helps reduce transaction complexity.

A Win for Patients, GPs, and Investors

According to RACGP Queensland Chair Dr Cath Hester, the exemption ensures practices remain viable and accessible:

“This will help to improve access to affordable GP care for people across our state, at a time when many are struggling with cost-of-living. It also gives general practices certainty that they can remain viable and keep their doors open.”

This certainty not only benefits patients but also reassures investors that the general practice sector will remain stable, sustainable, and attractive for acquisition.

Will Other States Follow?

Queensland has taken the lead, but the RACGP is calling for other states and territories to adopt the same policy. If adopted nationwide, payroll tax exemptions could revitalise practice sales across Australia, creating consistency for buyers and eliminating one of the biggest recent threats to the sector.

Key Takeaway for Business Owners

If you own a general practice in Queensland, the payroll tax exemption is likely to:

  • Strengthen your business valuation
  • Increase buyer demand
  • Provide leverage in negotiations

For buyers, the exemption reduces risk and ensures a more sustainable investment environment in one of Australia’s most essential healthcare sectors.

Ready to Sell Your General Practice?

With regulatory clarity and strong demand for quality healthcare businesses, now may be the perfect time to consider selling.

At Clinch Group, we specialise in connecting practice owners with motivated buyers, locally and internationally, helping you achieve the best result.

Contact us today for a confidential discussion about selling your general practice.

Disclaimer: This content is general in nature and not financial or business advice. Please reach out to Clinch Group for personalised advice.