Need help understanding changes to the PAYG withholding cycle? The Australian Taxation Office (ATO) conducts annual reviews of Pay As You Go (PAYG) withholding cycles to ensure they are aligned with your business’s annual withholding amount. If your PAYG withholding cycle has changed, you would have received a letter from the ATO during April 2024. Starting 1st July 2024, reporting and paying obligations will shift accordingly. Read on to find out how these updates affect your business, the steps to manage new reporting and paying obligations, and what actions to take if you disagree with the changes.
What is the PAYG Withholding Cycle?
The PAYG withholding cycle is the schedule on which you report and pay the amounts you withhold from payments to employees, contractors, and other businesses. The ATO reviews these cycles annually to ensure they are appropriate for your business based on your annual withholding amounts. To learn more about PAYG withholding cycles, you can visit the ATO’s Changing a withholding cycle.
Why Did My PAYG Withholding Cycle Change?
The updated cycle for your business will be determined based on the total amount withheld across all branches of your Australian Business Number (ABN) during the prior financial year. This means the ATO has assessed your withholding amounts and decided that a different cycle better suits your current withholding levels. As an example, changing from quarterly reporting to monthly reporting.
What Should I Do If I Disagree?
While you cannot object to the notice of a changed withholding cycle, you have options if you disagree with the decision. As an example, you can request to remain on your existing cycle.
How to Stay Informed
For more detailed information, you can read about the Changes to PAYG withholding cycle on the ATO’s website. Staying informed will help you understand your obligations and ensure compliance with the new cycle.
Need Help?
Need help understanding changes to PAYG withholding cycle? Navigating these changes can be complex, but you don’t have to do it alone. If you need assistance understanding the new PAYG withholding cycle or managing your reporting and paying obligations, contact us. We are here to help.
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