Why do I need to pay PAYG Instalments?
Updated: Feb 11, 2021
PAYG Instalments is the estimated tax that the ATO believes that you will need to pay in the following financial year. If you had a tax bill this year then next year you will need to submit a PAYG Instalments report – the ATO will automatically enroll you into PAYG Instalments. If you want to adjust the report - you will need to submit a variance within 28 days of the report opening date.
Individuals you have a tax liability will be enrolled into PAYG Instalments. Items such as small business income, Rental Property Income, Capital Gains, Director Fees, Unfranked Dividends can cause a shortfall in tax when added to your PAYG income that has been taxed.
If the event that caused a shortfall is not a regular occurrence such as -Sale of a property – then you can request to have the PAYG Instalments reduced to Nil.
There a times where the year ahead is not going to be as good as the last and vice versa. You can adjust your PAYG Instalments up and down. This helps to take the burden off at tax time.
Prepaying your taxes can be a good thing as it takes the burden out of such a large chunk of tax in one go.
We can take care of all your PAYG obligations and make sure you are paying the correct amount.
If you would like to know more then please get in contact with me on (07)3088 9012