• Instructions for your variation application

    The following instructions will help you complete your application.

    On this page:

    Section A: Your details

    A1 Tax file number (TFN)

    If you choose not to provide your TFN, your application may be delayed.

    A2 Employment declaration or TFN declaration

    You will not be granted a variation if you haven't quoted your TFN to your payer, unless you are exempt from quoting your TFN.

    You are exempt from quoting a TFN if you are either:

    • under 18 years old and do not earn enough to pay tax
    • a recipient of certain pensions, benefits or allowances from Centrelink, Department of Veterans' Affairs, or the Military Rehabilitation and Compensation Commission.

    However, you must quote your TFN if you receive Austudy, Newstart Allowance, Sickness Allowance or Parenting Payment.

    A7 Authorised contact person who completed the form

    Only include if this application is not completed by you.

    A10 Australian resident for tax purposes

    Select your correct residency status. If you are unsure of your residency status or if you need more information:

    A12 Reason codes

    There is a list of reason codes on page 2 of the PAYG withholding variation application.

    It is important to use the correct reason code. If your reason code begins with 05, you must select only one code. If your reason code begins in the range 08–17, you can select more than one code within these ranges – for example, two or more payers 11A0 and Negative gearing 08A0.

    Section B Payer details

    If your reason code at A12 begins in the range 05, you need to only complete B12 and B13. If your reason code at A12 begins in the range 08 to 17, you need to complete all applicable fields in B1 to B13. If you do not complete these items, your application will be returned to you. If you have more than two payers, attach a separate page with the required details.

    B1(b) Will you be receiving payments from this payer for the full year?

    If you will be receiving income from this payer for the full year, select Yes. If you will be receiving payments from this payer for part of the year, select No and include the total income received and tax withheld to date for your current and all previous payers at B12 and B13.

    B2 Voluntary agreement with your payer to withhold amounts

    You can enter into a voluntary agreement with a payer only if you have an Australian business number (ABN) (an independent contractor or consultant) and if no other provision requires an amount to be withheld from the payment.

    If you do not have an ABN, answer No at this item.

    If you have entered into a voluntary agreement with a payer, you must provide all the details in section G on the PAYG withholding variation supplement and attach a copy of the voluntary agreement.

    B3 Australian business number (ABN)

    The implementation of your variation may be delayed if you do not provide a correct ABN.

    B4 Business name

    Provide your payer's business name.

    B5 Pay office postal address

    Provide your payer's pay office postal address. For privacy reasons, this should preferably be a PO Box, locked bag or similar address. We may not use the address you provide if we determine that it is not the payer's preferred address.

    B6 Pay officer's direct phone number

    Provide your pay officer's phone number.

    B7 Payroll ID, employee number or policy number

    Provide your payroll ID, employee number or policy number. Your payer uses this information for identity purposes.

    B8 Gross per pay

    Provide the amount you are receiving each pay before tax is withheld.

    B9 Tax withheld per pay

    Provide the amount of tax your payer is withholding from each pay.

    B10 Pay frequency

    Select the applicable box to indicate how often you are paid

    B11 Dates of last pay and next pay

    Provide the date you were last paid and the date you next expect to be paid.

    B12 Gross payments received since 1 July

    Provide the total amount of gross payments you have received from current and all previous payers since 1 July of the application year.

    B13 Tax withheld since 1 July

    Provide the total amount of tax withheld from your payments from current and all previous payers since 1 July of the application year. Include tax withheld where your ABN was not quoted and the amounts have not subsequently been refunded to you.

    Section C Rental details

    You are required to complete all the details in this section only if you are a first-time applicant or have applied for a withholding variation previously and your rental details have changed since you last lodged.

    Percentage owned

    Joint tenants and tenants in common must divide the income and expenses in accordance with their legal interest in the property. With joint tenancy, each tenant holds an equal interest in the property. For example, if you and your spouse are the only names listed on the title deed and you are listed as joint tenants, show 50% at the percentage owned item. A partnership agreement, either oral or in writing, cannot change this.

    Section D Investment details

    You must complete section D if your reason code at A12 begins in the range 09, 16 or 17. You must also declare any deductions relating to this investment at F2.

    Section E Annual income and tax offsets

    You must complete this section, or your application will be returned to you. You must fill in at least one item at E1 to E5. Your varied or reduced rate will only apply to the type of income or payment you complete at E1 to E5.

    E1(a) Payments for work and services

    Do not include any reportable fringe benefits amounts at this item – for example, salary sacrifice amounts.

    Do not include payments for employment termination (ETP). Include ETP payments at E5(a) Employment termination payments. If your current approved variation does not include ETP details, and you will be receiving an ETP, your payer must withhold at normal withholding rates for the ETP. For reduced withholding to apply to the ETP, you need to lodge an amended application and include the ETP details at E5(a).

    E1(a)(iv) Bonus payments

    Provide details of bonus payments. For bonus payments you have already received, then:

    • include bonus payment at B12
    • include tax withheld from bonus payments at B13.

    For bonus payments not yet received, and you want:

    • your variation to apply to your bonus payments, you must:
      • enter the bonus payment amount at E1(iv)
      • select the Varied rate to apply to bonuses box at E1(a)(iv)
    • normal tax to be taken out of your bonus payments (that is, your new varied rate will not apply to your bonuses), you must:
      • enter the bonus payment amount at E1(iv)
      • select the Normal tax to be taken out of bonuses box at E1(a)(iv)
      • include the bonus payment amount and the expected tax withheld from the bonus payments at Annual gross income and Annual tax B1(a), Payer 2.

    E4(a) and 4(b) Australian annuities and superannuation income streams

    Do you receive more than *$100,000, including tax free amounts, from your combined superannuation income streams – Yes or No.

    If you answered No to this question:

    • If you are 60 years or over for the entire income year – only include the taxable components you expect to receive if they comprise an element that is untaxed in the fund (paid from an untaxed source). Show the amount of any tax offset that applies to this income at E13 Tax offsets.
    • If you turn 60 in the income year and your income is from a taxed source – only show the taxed element of the taxable component for any benefits you expect to receive before you turn 60. If your super income stream has an element that is untaxed in the fund, show the total amount for the year.
    • If you are between preservation age and under 60 for the full income year – show the total amount of the taxable components for any super income stream benefits you expect to receive from any payer(s). Show the amount of any tax offset that applies to this income at E13 Tax offsets.

    If you answered Yes to this question:

    From 1 July 2017 income from certain defined benefit pensions will be subject to additional income tax rules.

    • half of the income from the tax free component' and 'taxed element of the taxable component in excess of $100,000' will be included in the individual’s assessable income.
    • income in excess of *$100,000 does not attract the offset.

    Answer this question at E4

    There are three components of a pension that must be taken into consideration, the:

    • tax free component
    • taxed element of the taxable component
    • untaxed element of the taxable component.

    Where an individual has more than one capped defined benefit income stream, the taxation consequences will be calculated based on the sum of each of the components across all income streams.

    Before 1 July 2017, the tax-free component and taxed element of the taxable component are tax free to recipients 60 years and over. From 1 July 2017, 50% of any of income in excess of the defined benefit income cap *($100,000) from these sources will be included in the individual's assessable income.

    Before 1 July 2017, the untaxed component is included in an individual's assessable income and those who are 60 years and over are entitled to claim a 10% tax offset. From 1 July 2017, defined benefit income received in excess of the defined benefit income cap does not attract the offset. The offset is capped at a maximum of $10,000 (10% x *$100,000). Show the amount of any offset that applies to this income at E13 Tax offsets.

    From 1 July 2017, where the defined benefit pension payment includes the three components listed above, different rules will apply when calculating the 10% offset. The taxed element and tax free amount of the payment is counted towards the defined benefit income cap first. The untaxed element is then counted towards the defined benefit income cap. However, the tax offset is limited to 10% of the untaxed element that is counted towards the defined benefit income cap. Your super income stream will be paid from an untaxed source primarily because it is paid, at least in part, from a super scheme that is not subject to tax, such as a public sector super scheme. If you are not sure, check with your fund.

    * The defined benefit income cap is generally $100,000 but this will be reduced; where you first become entitled to concessional tax treatment in respect of defined benefit income part-way through a financial year (for example if you turn 60 years during the year) or where a person becomes entitled to other defined benefit income that is not subject to concessional tax treatment (for example, death benefits and other member benefits in certain circumstances).

    E5 Employment related payments

    There are different types of employment termination payments (ETP). For more information, refer to the Employment termination payments.

    E6 Partnership/trust income or partnership loss

    If you have a partnership loss, complete Section H on the PAYG withholding variation supplement .

    E7 Net income or loss from business

    If you have net income or loss from business, complete Section G on the PAYG withholding variation supplement

    Do not include income or losses derived from an investment in a managed investment scheme that also has a product ruling or a private binding ruling. Income from this source is to be shown at E8, E10 or E11 and the deductions at F2.

    See also:

    E9 Gross rent

    Only include your portion of the rental income. If the title deed shows that you are only a part owner of the property, include only your share of the rent – for example, if you own 50% of the property, you should show 50% of the rent. Do not put a negative amount. Only include gross rent and claim the deduction at F3.

    E14 Income tests

    There are income tests for working out your eligibility to receive certain tax offsets and claim certain deductions. To apply these income tests, we need your:

    • reportable fringe benefits
    • reportable employer super contributions
    • exempt foreign employment income.

    See also:

    E15 Spouse's adjusted taxable income

    Your spouse's adjusted taxable income affects your entitlement to any dependant tax offset.

    Use our Income tests calculator to work out your spouse's adjusted taxable income.

    E16 Medicare

    An exemption from the Medicare levy is claimable in certain circumstances. For more information refer to Medicare levy.

    Section F Annual deductions

    Provide details of deductions for expenses incurred in earning your assessable income.

    F1 Work-related expenses

    For more information refer to Deductions you can claim.

    F2 Investment deductions

    If you are claiming investment deductions, you must complete the investment details in section D. Income from the investment is to be provided at E8, E10 or E11.

    F3 Expenses related to rental property

    Provide only rental expenses at this item. If the title deed shows that you are only a part owner of the property, include only your share of the rental expenses – for example, if you own 50% of the property, you should show only 50% of the rental expenses. For more information, refer to Rental property expenses.

    F4 Tax losses of earlier income years claimed this income year

    You cannot claim a tax loss from an earlier income year if your taxable income last year was more than zero.

    See also:

    F5 Personal superannuation contributions (deductible)

    See also:

    Last modified: 01 May 2017QC 21682