Can I be grouped with a business I own in a different state?

Yes. SRO Victoria explicitly confirms grouping applies even where one of the businesses is interstate or overseas — control is what triggers grouping, not where the other business is registered or operates.

Does grouping apply if I've never received a distribution from a family trust?

It can. Under the discretionary trust deeming rule used in NSW, VIC and QLD, every person who could potentially benefit from the trust is deemed to hold a controlling interest, regardless of what they've actually been paid — this catches beneficiaries who have never received a cent.

Can I apply to be excluded from a group?

In most circumstances, yes — but the process and evidence required differ by state, and in Victoria, exclusion isn't available at all for grouping based on related corporations. See the exclusion process for your state below.

If I own less than 50% of a business, am I safe from grouping?

Not necessarily. Revenue offices can trace interests held indirectly through other entities you control and add them to your direct interest — a chain of holdings under 50% at each link can still combine to a controlling interest overall.

What's the difference between grouping and interstate apportionment?

Interstate apportionment reduces one business's threshold based on how its own wages are spread across states. Grouping is a separate, prior question — it determines whether several legally distinct businesses are treated as a single taxpayer sharing one threshold in the first place. Grouped businesses then have that shared threshold apportioned across states the same way an individual business's would be.

Payroll tax grouping: how "common control" actually gets tested

Written by Cross State Payroll teamPublished 23 July 2026Last reviewed 14 August 2026

“Common control” sounds like it should mean one person owning two companies outright. In practice it’s tested far more broadly than that, and it’s the most common way two businesses end up grouped for payroll tax without anyone deliberately structuring for it. See our grouping overview for what grouping does to your threshold — this post is about how the control test itself actually works, where people misjudge it, and what the process looks like if you think it doesn’t apply to you.

Common control is only one gateway into a group

It’s worth naming upfront that common control isn’t the only way two businesses can be grouped — the Queensland Revenue Office’s own overview lists five separate gateways: related bodies corporate, common employees, controlling interest (common control), tracing of interest through corporations, and merged groups. Common control is simply the one that most often surprises business owners, because unlike a related-company structure that’s visible on a company register, control can arise from voting rights, trust arrangements, or an indirect chain of ownership that isn’t obvious without actually mapping it out.

The >50% threshold, by entity type

NSW, VIC and QLD all use the same basic trigger: a person, or a small set of people acting together, controls more than 50% of a business. What counts as “control” depends on the entity type:

Companies — more than 50% of voting power at director meetings, or more than 50% of voting shares. VIC’s formulation adds that control of board composition itself is enough on its own, even without a voting-share majority.
Partnerships — more than 50% of the partnership’s capital, or an entitlement to more than 50% of its profits.
Unincorporated bodies (VIC specifically calls these out) — constituting or controlling more than 50% of the body’s management board.
Fixed trusts — a beneficiary entitled to more than 50% of the value of interests in the trust.
Discretionary trusts — every named or eligible beneficiary is deemed to hold a controlling interest, regardless of how much (or how little) they’ve actually been distributed in a given year. This is the one that catches people out: a beneficiary who has never received a distribution can still trigger grouping.
Sole traders — the sole owner, including where they hold the business as trustee, controls it outright.

And control isn’t confined by state or national borders — SRO Victoria’s guidance is explicit that grouping applies even where one of the businesses operates interstate or overseas. A Melbourne business controlled by the same person as a business registered in Auckland or Singapore can still be grouped for Victorian payroll tax purposes, if the control test is met.

Worked example: the discretionary trust trap

Take a hypothetical family trust with three potential beneficiaries — a parent and two adult children. The parent operates a business, Widget Co, and the shares in Widget Co are held by the family trust. Only the parent has ever taken a distribution; the two adult children have never received a payment and have no involvement in Widget Co’s operations. Under the deeming rule used in all three states, all three people are treated as controlling Widget Co, not just the parent who actually runs it and takes the money. If either adult child separately owns or controls another business, that business is now a candidate for grouping with Widget Co too — a connection that wouldn’t show up on any cap table, because it runs through the trust’s discretion, not a shareholding.

Worked example: tracing through a chain

Where someone’s direct interest in a business is under 50%, revenue offices can trace indirect interests held through other entities they control, and add them together. Revenue NSW publishes a worked example: a person holds a 50% direct interest in Company C, plus an indirect interest through a chain — 80% of Company A, which holds 40% of Company B, which holds 50% of Company C. That indirect chain contributes 80% × 40% × 50% = 16%. Combined with the 50% direct interest, that’s a 66% aggregate interest in Company C — enough to group that person with Company A and Company C. Company B, where the same person’s traced interest works out to only 32%, is not grouped on this basis.

The Queensland Revenue Office publishes a similar mechanism using corporate control: if Company S controls Company C (as its parent), and Company C separately holds a controlling interest in a partnership, Company S is deemed to also control that partnership — even though S has no direct relationship with it at all. All three entities end up grouped. The practical lesson from both examples is the same: draw the actual ownership chain out on paper before concluding you’re safe at 40% or 45% direct ownership. A chain two or three entities deep can easily push an aggregate interest over the 50% line.

Common mistakes business owners make here

Assuming grouping requires identical shareholders on paper. Control through voting rights, board composition, or a discretionary trust is enough — the shareholder register alone doesn’t tell the whole story.
Assuming an untouched trust beneficiary is outside the group. The deeming rule ignores actual distributions entirely — see the worked example above.
Only checking direct ownership. Missing an indirect interest traced through a chain of entities is one of the most common ways a business is grouped without realising it.
Assuming separate bank accounts and ABNs are enough to prove independence. Revenue offices assessing an exclusion application look at the actual course of dealing between businesses — shared staff, shared premises, transaction volumes between them, financial interdependency — not just whether the paperwork is separate.
In Victoria, assuming exclusion is always available. It isn’t — exclusion applies to common-control, common-employee, tracing and merged-group grounds, but not to grouping based on related corporations.

Applying for exclusion

A business that meets a grouping test on paper but genuinely operates independently can apply to be excluded. The process differs meaningfully by state:

NSW — a written application to the Chief Commissioner, with no standard form. You need to show the business is carried on independently of, and not connected to, every other group member’s business — meaning no more than casual, irregular or occasional dealings between them. Revenue NSW weighs factors like transaction volumes, shared staff or resources, financial interdependency, purchasing and selling links between the businesses, and how similar the businesses’ activities are.
VIC — an online “Application for Exclusion from Grouping” form, printed and signed before a witness (for a company, a director or public officer), then lodged online or by post. A rejected application can be objected to within 60 days. As noted above, exclusion isn’t available at all for grouping based on related corporations — only for common-control, common-employee, tracing or merged-group grounds.
QLD — a named form, PT1, lodged with supporting evidence covering the entire period the exclusion is sought for. Evidence can include declarations from employees, managers, accountants, customers or suppliers, and the applicant must consent in writing to QRO contacting them to verify. A high level of common ownership is explicitly flagged by QRO as a factor that can, at a sufficiently high level, outweigh all other independence factors. Exclusions can be granted retrospectively where independence is demonstrated for the full claimed period.

What to do next

Map out ownership and control across every related entity you’re connected to, including trusts and their potential beneficiaries — not just companies you directly hold shares in.
Check for common employees between entities — staff performing duties across more than one business is its own separate grouping trigger.
If a chain of ownership exists, calculate the traced aggregate interest rather than relying on the direct percentage alone.
Once you know whether you’re grouped, model the combined threshold impact using the grouping calculator.
If the businesses genuinely operate independently, start gathering the kind of evidence your state’s exclusion process asks for — separate customer bases, independent staffing, and financial records — before lodging an application.

None of this is a determination this site — or any calculator — can make for you. Whether you meet a control test, and whether an exclusion application would succeed, depends on your specific ownership structure and how independently the businesses actually operate.

Frequently asked questions

Can I be grouped with a business I own in a different state?: Yes. SRO Victoria explicitly confirms grouping applies even where one of the businesses is interstate or overseas — control is what triggers grouping, not where the other business is registered or operates.
Does grouping apply if I've never received a distribution from a family trust?: It can. Under the discretionary trust deeming rule used in NSW, VIC and QLD, every person who could potentially benefit from the trust is deemed to hold a controlling interest, regardless of what they've actually been paid — this catches beneficiaries who have never received a cent.
Can I apply to be excluded from a group?: In most circumstances, yes — but the process and evidence required differ by state, and in Victoria, exclusion isn't available at all for grouping based on related corporations. See the exclusion process for your state below.
If I own less than 50% of a business, am I safe from grouping?: Not necessarily. Revenue offices can trace interests held indirectly through other entities you control and add them to your direct interest — a chain of holdings under 50% at each link can still combine to a controlling interest overall.
What's the difference between grouping and interstate apportionment?: Interstate apportionment reduces one business's threshold based on how its own wages are spread across states. Grouping is a separate, prior question — it determines whether several legally distinct businesses are treated as a single taxpayer sharing one threshold in the first place. Grouped businesses then have that shared threshold apportioned across states the same way an individual business's would be.