ATO Letter: Not required to pay PAYG Annual Installment

Discussion in 'Accounting & Tax' started by legallyblonde, 29th Jun, 2017.

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  1. legallyblonde

    legallyblonde Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    858
    Location:
    TAS
    Following on my earlier post about "Tax Debt = Interest Free Loan"

    I was suppose to pay a few thousand dollars in prepayment for the 16/17 FY in quarterly installments, I phoned to arrange an annual installment which was due in a few months.

    I just got a letter on my my.gov account saying that because the funds are due so close to when I am required to lodge that I no longer need to make the lump sum installment! Last year I paid my tax debt just before Christmas, so I have bought myself a few months. This years debt will be about 6k.

    Anyone else have this happen? I am pretty happy. One transaction will be easier than two!
     
    legallyblonde, 29th Jun, 2017
    #1
    Bayview and Ross Forrester like this.
  2. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    23,587
    Location:
    Sydney
    Choosing annual instalments can cancel a instalment in limited instances. (ie if the ATO have just issued the Q4 IAS for example). Tends to apply to very late lodgers only.

    Annual instalments mean you get the chance to determine ACTUAL 2017 income around October and then vary the tax due down or pay the amount due based on real numbers and not the mystical ATO dartboard system. Its far less prone to overpayment OR underpayment. One of my tips is to draft your tax (or even complete it) around October and then DONT lodge until May the next year if you use an agent. You will be more certain about what to pay and use the ATO as a interest free lender for the max possible.

    The downside is its one amount due 28th October (for the 2017 tax year). And if you leave it until 29th October to vary it you cant. They reject variations after the due date unless you have an exceptional reason.
     
    Paul@PAS, 29th Jun, 2017
    #2
    legallyblonde likes this.
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