Repayment of overpaid amounts

If you overpay a payee you must decide if the payee is required to repay the overpaid amount.

If you decide that the payee:

• is not obliged to repay the overpaid amount – you do not need to do anything (unless you are a state or Australian government departments or agencies, as employees may need to repay the overpaid amount)
• has to repay the overpaid amount – the action you need to take depends on whether the overpayment is identified in the same financial year or a later financial year.

If the employee is obliged to repay the overpaid amount, fringe benefits tax (FBT) may apply if you:

• allow the employee time to repay the overpaid amount
• waive the employee's obligation to repay the overpaid amount.

Find out about:

• Overpayment relates to a previous financial year
• Overpayment identified within the same financial year

See also:

• Fringe benefits tax – a guide for employers (NAT 1054)