On 12 May 2026, as part of the 2026–27 Federal Budget, the Government announced a new way for businesses to manage their pay as you go (PAYG) instalments.
From 1 July 2027, you’ll be able to adjust your instalments in line with your current, real-time business conditions through Dynamic PAYG instalments.
This change builds on our work with businesses to modernise PAYG instalments. It means you’ll be able to:
- opt into an ATO-approved Dynamic PAYG instalment calculation built into accounting software you may already use
- keep instalments aligned with how your business performs during the year.
We're working to prepare for the introduction of Dynamic PAYG instalments, including holding ATO pilot programs and collaborating with software providers and stakeholders during the 2026-27 financial year.
To support your confidence in using this method, we’ve published our draft practical compliance guideline PCG 2026/D3 Dynamic pay as you go instalments general interest charge on excessive variation.
It confirms that we won’t allocate compliance resources to apply or collect General Interest Charge if you use the Dynamic PAYG calculation method as intended. We'll apply this PCG to pilot participants and those that opt-into Dynamic PAYGI from 1 July 2027.
We encourage you to review and provide your comments by 28 August 2026.
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