Example 1

Entertainment and sports activities

The Norwegian band Xotik Rivalry is touring Australia from February to April. The payee entity type for the band is a company. Xotik Rivalry will play seven concerts across Australia and the Australian events organiser Huge Events Unlimited Pty Ltd will pay them $2 million for each appearance a total of $14 million in payments. The company Xotik Rivalry has allowable deductions of $8 million.

Step 1

$14,000,000 x 30% = $4,200,000

Step 2



(total Australian payments)



(non-taxable or exempt payments)



(taxable Australian payments)



(allowable deductions)



(taxable income)

Step 3

$6,000,000 x 30% = $1,800,000

Step 4

Step 1 result

= $4,200,000

Step 3 result

= $1,800,000


= $2,400,000

The end-of-year tax liability (step 3 result) is less than the amount of PAYG withholding (step 1 result). Xotik Rivalry can either:

  • apply for a FRWV to reduce their PAYG withholding, or
  • wait until the end of the income year and lodge a tax return to get a refund.

Step 5

($1,800,000   $14,000,000) x 100 = 12.85%

If Xotik Rivalry decides to apply for a FRWV, the required rate of withholding on the FRWV application will be 12.85%.

    Last modified: 30 Jan 2013QC 18617