In May 2026, as part of the 2026–27 Federal Budget, the Government announced a streamlined way for businesses to manage their pay as you go (PAYG) instalments.
From 1 July 2027, Dynamic PAYG instalments will assist you to vary in line with your current, real-time business conditions.
The change builds on our work with businesses to modernise PAYG instalments. It means you’ll be able to:
- opt into using an ATO-approved Dynamic PAYG instalment calculation built into accounting software you may already use
- vary your payments to fit your business activity across the year.
We're preparing for these changes now. This includes setting up pilot programs and working with software providers and stakeholders during 2026–27.
We’ve also published our draft practical compliance guideline PCG 2026/D3 Dynamic pay as you go instalments general interest charge on excessive variation. This guidance clarifies our compliance approach and confirms we won’t allocate resources to apply or collect General Interest Charge if you use the Dynamic PAYG calculation method as intended.
The PCG will apply to pilot participants and businesses that opt into the initiative from July 2027.
We encourage you to review the guidance and provide any feedback by 28 August 2026.
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