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  • PAYG withholding – correcting mistakes

    To correct a mistake in the pay as you go (PAYG) withholding amount reported on your activity statement, you need to revise the original activity statement. If you failed to report an amount not withheld when it should have been, you can write to us.

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    Failure to withhold

    To correct a mistake where you did not withhold PAYG withholding amounts from a payment, or you withheld the wrong amount, you need to write to us. You should not include any amount that you failed to withhold on either an original or a revised activity statement unless advised to by us.

    By writing to us you are making a voluntary disclosure which gives you the opportunity to correct your tax obligations. If you have failed to withhold an amount from wages to an employee you could lose your deduction unless you make a voluntary disclosure.

    To find out how to write to us, see What to include in your letter.

    Failure to notify

    If you withheld the correct amount of PAYG withholding, but made a mistake reporting it, or failed to report it when you should have, you need to lodge a revised activity statement.

    To correct a mistake where PAYG withholding amounts were overstated you need to lodge a revised activity statement.

    Voluntary disclosure

    If you revise an earlier activity statement and the revision increases the tax you owe, or you advise us by letter that you've not withheld an amount from a payment, we generally treat the revised activity statement or letter as a voluntary disclosure. This means you're likely to receive concessional treatment for any penalties and interest charges that apply.

    See also:

    What to include in your letter

    When you write to advise us of an amount you didn't withhold from a payment, include the following information:

    • the title 'Voluntary disclosure – PAYG withholding'
    • your name or your business's name – that is, the full name of the taxpayer that should have withheld the amount
    • your phone number and address or the name, phone number and address of your authorised contact or tax agent
    • the name of the person or organisation you made the payment to
    • the date you made the payment
    • what the payment amount was
    • what the amount you should have withheld was, or an estimate of what it should have been
    • a signed and dated declaration as follows

      I declare the information I have given in this letter, including attachments, is true and correct and that I am authorised to disclose this information.

      your signature

      the date

    Keep a copy of the letter for your records.

    Mail your letter to us at:

    Australian Taxation Office
    PO Box 3575
    ALBURY  NSW  2640

    Your tax agent can also make a voluntary disclosure on your behalf by sending the required information though an ATO approved electronic channel. The tax agent will need to ensure that their tax agent number is linked to your records.

    Payment summary corrections

    Whatever the mistake, if you've issued any payment summaries to your payees for the period in which the error was made you may need to correct them.

    Changing a payment summary may mean you also need to revise your payment summary statement or payment summary annual report, or both.

    See also:

    Last modified: 12 Aug 2019QC 33789