Your PAYG instalments correspondence
If you have to pay PAYG instalments, we'll send you a letter with some general information and your options. Before your instalments are due, we'll send you either an activity statement or instalment notice.
For individual taxpayers (including sole traders), PAYG instalments correspondence will be delivered to you electronically if you're registered for myGov and your account is linked to the ATO. We'll send you an email to let you know that the item is available in your myGov inbox.
If you still receive paper mail from us, we use your 'income tax' address for PAYG instalments. However, you can choose to have a different postal address for your activity statements / instalment notices.
Understanding your PAYG correspondence
Your PAYG correspondence may include some unfamiliar terms which are explained below.
Your PAYG instalment rate
Your PAYG instalment rate is a percentage figure that we use to help make sure the total instalments you pay are as close as possible to the expected tax payable on your business and/or investment income. We calculate your PAYG instalment rate from your latest tax return.
Your notional tax
This is an estimate of the tax payable on your business and/or investment income, excluding net capital gains, in the latest year for which your income tax has been assessed. Your notional tax is used to work out your PAYG instalment rate.
Your notional tax adjusted for GDP
Your PAYG instalment amount should reflect your expected tax liability for the current income year as accurately as possible. To account for expected changes in the economy – as measured by the change in gross domestic product (GDP) – we make a GDP adjustment to your instalment amount.
Your instalment amount
This is the amount you will be required to pay each period if you choose to pay the instalment amount we calculate and you are eligible for this option. This amount is based on your most recent tax return (and includes an adjustment for GDP).
If we work out that you need to pay instalments, we will notify you. The letter will advise you of the options available for calculating your instalments and how often you need to pay.