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  • Interest charged by the ATO

    You can claim a deduction for interest we charge on:

    • late payment of taxes and penalties
    • any increase in your tax liability as a result of an amendment to your assessment
    • any increase in other tax liabilities, such as goods and services tax (GST) or pay as you go (PAYG) amounts
    • any underestimation of your tax liability when you vary an instalment for GST or PAYG.

    The interest we impose includes:

    • general interest charge (GIC)
    • shortfall interest charge (SIC)
    • late payment interest.

    You can claim any interest we impose in the year it is incurred. This will depend on when you actually became liable for the interest. For example:

    • SIC is incurred on an unpaid income tax shortfall in the year you are served a notice of amended assessment.
    • GIC imposed on existing unpaid tax liabilities is incurred on a daily basis, in the year it is imposed.

    You claim a deduction for ATO interest at Cost of managing tax affairs – Interest charged by the ATO, in your income tax return.

    See also:

    Last modified: 15 Jun 2020QC 31992