Thousands of support workers in Melbourne now work for themselves, either directly with self managed and plan managed participants or as contractors to NDIS providers and online platforms. Working on an ABN gives you control over your rates and hours, but it also moves tax, super and insurance from your employer’s desk to yours. This guide explains how tax for independent NDIS support workers works and how to set yourself up properly from day one.
Employee or contractor?
Having an ABN does not make you a contractor. Whether you are an employee or an independent contractor depends on the real working relationship: who controls how and when you work, whether you can delegate the work to someone else, whether you are paid for hours or for a result, and whether you supply your own tools, vehicle and insurance. A worker who is told when to start, which participants to see and how to do the job, and who is paid by the hour, may legally be an employee even if they invoice with an ABN.
This matters to providers as much as workers. The ATO treats a contractor who is paid mainly for their own labour, must do the work personally, and is paid for their time rather than a result as an employee for super guarantee purposes. Having an ABN does not change that. A provider engaging support workers this way must pay super for them, and since 1 July 2026 that super has to reach the worker’s fund within 7 business days of payday.
Setting up as an independent support worker
- ABN: apply through the Australian Business Register. Most support workers operate as sole traders.
- NDIS Worker Screening Check: required for workers in risk assessed roles with registered providers, and expected by most participants and platforms.
- NDIS Code of Conduct: applies to all workers and providers, registered or not.
- Insurance: public liability and professional indemnity cover. As a contractor you are generally not covered by an employer’s WorkCover, so consider income protection.
- Business bank account: keep participant payments and business expenses separate from personal spending.
- Service agreements: a written agreement with each participant or provider covering supports, rates, cancellations and the participant’s plan.
GST for support workers
You must register for GST once your turnover reaches $75,000 a year. What happens next depends on who you invoice:
- Directly to a self managed or plan managed participant: your supports can be GST-free if the participant has a plan in effect, the support is in the plan, it is covered by the NDIS GST-free determination, and you have a written agreement. See our guide to GST-free NDIS supplies.
- To an NDIS provider who engages you as a subcontractor: your supply is to the provider, not the participant, so it is not GST-free. If you are registered for GST you charge the provider GST, and they claim it back.
Income tax: nobody is withholding it for you
As a sole trader, no tax is taken out of your payments. You pay tax on your profit (income less business expenses) in your individual tax return, at your normal marginal rates. A practical habit is to transfer 25 to 30 per cent of each payment into a separate savings account for tax. Once you have a tax bill after your first return, the ATO will usually place you in PAYG instalments so you pay quarterly through the year instead of in one lump sum.
Deductions you can usually claim
- Car expenses for travel between participants, and to shops or appointments while providing support. Trips from home to your first participant and back from the last are usually private travel unless your home is your base of operations
- Use the cents per kilometre method (up to 5,000 business kilometres) or keep a logbook for at least 12 weeks
- Insurance premiums, worker screening and first aid certificates, and training directly related to your current work
- Phone and internet, for the business portion
- Personal protective equipment and consumables you pay for
- Software for rostering, invoicing and progress notes
- Accounting and tax agent fees
Keep receipts and a diary or logbook. Platforms report contractor payments to the ATO, so your declared income needs to match.
Super is your responsibility
Sole traders do not have to pay themselves super, but most support workers have no other retirement savings growing while they are self employed. You can make personal contributions to your fund and claim a tax deduction, provided you lodge a notice of intent with the fund and receive its acknowledgement before you lodge your return. Concessional contributions are capped at $32,500 for 2026-27, including any super a provider pays for you. See our guide to contribution caps.
Frequently asked questions
Do I need to be a registered NDIS provider to work independently?
No. You can provide most supports to self managed and plan managed participants without registration, but you must follow the NDIS Code of Conduct. Agency managed participants can only use registered providers.
Should I set up a company?
Not usually at the start. A company adds ASIC fees, a separate tax return and Division 7A rules. It can make sense once profit is consistently high or you employ other workers.
When is my tax return due?
31 October if you lodge yourself, or later if you use a registered tax agent. See our sole trader tax return guide.
Tax help for support workers in Melbourne’s west
Kennedy Tax & Business Services prepares tax returns and BAS for independent support workers and NDIS providers across Footscray, Williams Landing and Melbourne’s west. See our NDIS financial services or contact us to book an appointment.
This article is general information only and does not take into account your circumstances. Speak to a registered tax agent before acting.
