Notice 23 - Explanatory statement

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COMMONWEALTH OF AUSTRALIA

Taxation Administration Act 1953

Explanatory Statement

General Outline of Instrument

This instrument is a notice exempting entities from providing employees and other payees with a duplicate copy of a pay as you go (PAYG) withholding payment summary for particular types of payments subject to PAYG withholding.

The instrument is made under section 16-180(1) of Schedule 1 to the Taxation Administration Act 1953.

The proposed instrument would be a legislative instrument for the purposes of the Legislative Instruments Act 2003.

Date of effect

This instrument applies from 1 May 2007.

What is this instrument about

The purpose of the notice is to remove the requirement for payers of withholding payments to provide payees with a duplicate copy of a payment summary where the payments are covered under Subdivisions 12-B (except sections 12-55 and 12-60), 12-C (except section 12-85) and 12-D of Schedule 1 to the Taxation Administration Act 1953.

What is the effect of this instrument:

The effect of the instrument is that payers will only be required to provide one original copy of the PAYG payment summary - individual non-business (NAT 0046) for the majority of their payees.

Background:

The requirement to provide both an original and a duplicate copy of the payment summary was put in place so that the payees were able to attach the original version to their annual income tax return and retain the duplicate copy for their personal records.

The majority of taxpayers now lodge their tax returns electronically and they are not required to provide a payment summary copy to the Tax Office. The Tax Office is able to use information reported directly from the employer or payer to check the amounts included in the tax return. There is no longer any justification for requiring those taxpayers who lodge paper tax return forms to attach a copy of their payment summary and this requirement will be removed from 2007.

In the circumstances, it is no longer necessary to compel employers and other payers to provide a duplicate copy to their payees.

Consultation:

No consultation has been conducted in respect of this instrument as its effect is to remove an unnecessary obligation from the community.

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16 April 2007

Deputy Commissioner of Taxation

Subject References:
PAYG payment summary
Pay as you go
PAYG withholding

Legislative References:
Taxation Administration Act 1953
12-35
12-40
12-45
12-47
12-50
12-80
12-90
12-110
12-115
12-120
16-180

Related Legislative Determinations:
Notice 23

Related Rulings/Determinations:
TD 2001/10