ATO issues reminder to SMSFs on PAYG instalments
SMSF trustees who believe their PAYG instalments will result in too little or too much tax may want to vary their PAYG instalments, says the Tax Office.
In a recent update, the ATO explained that pay as you go (PAYG) instalments can help SMSF trustees to make regular prepayments on their investment income throughout the financial year.
“Paying the right PAYG instalments can help you manage a healthy cash flow and avoid a large tax bill when you lodge your SMSF annual return,” the Tax Office advised.
SMSF trustees who think their current PAYG instalments could result in paying too little or too much tax can vary their instalments, it explained.
“You must make variations on or before the day your instalment payment is due. Your varied amount will apply for all your remaining instalments unless you make another variation before the end of the financial year,” it said.
“Use the PAYG instalment calculator to help you work out your new instalment amount or rate.”
The ATO also stated that where SMSF trustees have been impacted by the recent floods, they may vary their PAYG instalments and claim a credit for previous instalments paid in the same financial year.
“You claim this credit at label 5B on your business activity statement,” it said.
Variations can be lodged through MyGov, Online Services for business or a registered tax or BAS agent, the ATO stated.
Miranda Brownlee
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.
