Frequently asked questions
Do I still need to lodge an annual income tax return?
Yes. PAYG instalments is a system for paying amounts towards your expected end-of-year income tax liability. We work out your actual tax liability when we assess your annual income tax return. We credit your PAYG instalments for the year against your assessment and work out whether you owe more tax or are due a refund.
To make sure you receive the correct amount of credit in your assessment, you must finalise your PAYG instalments before you lodge your tax return.
How do I work out my instalment income at T1?
This amount should include all ordinary income earned from business or investment activities for the quarter (excluding GST). For details of what instalment income includes, refer to T1 - PAYG instalment income.
Do I include amounts I received from fuel grants in my instalment income at T1?
No. You don't include these amounts at T1.
What is the instalment rate printed at T2?
If this is your first PAYG instalment for the income year, we calculate an instalment rate for you and pre-print it at T2.
If this is not your first PAYG instalment for the income year, the instalment rate at T2 will be either:
- the instalment rate calculated by us, or
- the varied instalment rate you notified on a previous activity statement.
I was told I could get a credit for previous instalments if my instalment rate changes. Is this correct?
You may be entitled to a credit from earlier instalments in the same income year if you have varied your instalment rate and the rate you have written at T3 is less than the instalment rate pre-printed at T2.
You can only claim credits if you have varied your instalment rate and your earlier instalments in that income year were based on a higher instalment rate.
You may also be entitled to a credit if you use option 1 and vary your instalment amount. For more information, refer to 5B - Credit from PAYG income tax instalment variation.
Why have I received an instalment rate when my business is no longer trading?
Your instalment rate is based on your most recently assessed income tax return.
Generally, if you are an individual and your last income tax return showed $2,000 or more of income from business or investments and you had a tax debt of $500 or more (disregarding any voluntary payments or PAYG instalment credits that were applied), you will be given an instalment rate.
Most companies and superannuation funds must pay instalments, unless they have lodged a final return.
If you are using the option 1 instalment amount and your business is no longer trading, you may wish to vary your instalments to reflect the tax you expect to pay on your business and investment income for the year. You can vary to zero if you think you will have no business or investment income this year.
If you are using the instalment income x rate (option 2) to work out your instalments and your business is no longer trading, your instalment income for the period is likely to be zero. As a result, your instalment will be also be zero.
You will be removed from the PAYG instalments system after lodgment of the final income tax return for your business.
Can I make a voluntary payment?
Yes. But you don't make voluntary payments on your activity statement. If you have an electronic funds transfer (EFT) code, you can make a voluntary payment by BPAY or by direct credit. If you don't have an EFT code, phone us on 1800 815 886 for help.
Alternatively, you can mail your payment to:
VIC, TAS , WA , SA, NT
NSW, QLD, ACT
Australian Taxation Office
Locked Bag 1936
ALBURY NSW 1936
Australian Taxation Office
Locked Bag 1793
PENRITH NSW 1793
It's very important that you include the following information with your voluntary payment:
- payment type - for example, PAYG instalment payment
- your ABN or tax file number
- your full name and address (as shown on the front of your activity statement), and
- a contact phone number, including the area code.
What if I make a mistake?
You can correct a mistake by striking it out in black pen. Write the new information as close as possible to the boxes for the label. You can also use tape whiteout to correct errors. Do not use liquid whiteout - this causes problems with scanning which will delay the processing of your activity statement.
What if I only realised the mistake after lodging my activity statement?
Usually, you need to lodge a revised activity statement - phone us on 13 28 66 to obtain a revised activity statement form. Revised activity statements are also available from the Business Portal, if you are a registered user.
How do I update my address?
To ensure you receive the correct mail for each of your tax obligations in a timely manner, we encourage you to ensure the address details we have for you are correct.
To update your address for receiving activity statements, you can phone us on 13 28 66 or log on to the Business Portal.
To register for the Business Portal, or for more information, visit www.ato.gov.au/onlineservices or phone us on 13 28 61 for Personal Tax enquiries or 132866 for Business Tax enquiries.
Other activity statement instructions are available for
Provides education on how to complete the PAYG instalment labels on your activity statement.Last modified: 06 Jul 2016QC 27149