Taxation Administration Act 1953

SCHEDULE 1 - COLLECTION AND RECOVERY OF INCOME TAX AND OTHER LIABILITIES  

Note: See section 3AA .

Chapter 2 - Collection, recovery and administration of income tax  

PART 2-1 - INTRODUCTION TO THE PAY AS YOU GO (PAYG) SYSTEM  

Division 6 - Guide to Parts 2-5 and 2-10  

SECTION 6-5   THE PAY AS YOU GO (PAYG) SYSTEM  

6-5(1)  
Parts 2-5 and 2-10 establish the PAYG system, which has 2 components:

  • · PAYG withholding (Part 2-5 )
  • · PAYG instalments (Part 2-10 ).
  • PAYG withholding

    6-5(2)  
    Under PAYG withholding, amounts are collected in respect of particular kinds of payments or transactions. Usually, someone who makes a payment to you is required to withhold an amount from the payment, and then to pay the amount to the Commissioner.

    For a list of the payments and other transactions to which PAYG withholding applies, see Division 10 .

    PAYG instalments

    6-5(3)  


    You pay PAYG instalments directly to the Commissioner. These are usually based on your GDP-adjusted notional tax or your ordinary income for a past period, but excluding:
  • · income subject to PAYG withholding (with certain exceptions)
  • · exempt income, or income that is otherwise not assessable.
  • An instalment is usually paid after a quarter, but some taxpayers are eligible to pay an annual instalment after the end of the income year.




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