Are you suddenly receiving monthly instalment activity statements (IAS)?

We have noticed this month that the ATO has started sending out monthly IAS’s to clients who previously did not receive them.

You may have had your PAYG tax withholding (for wages) obligations included in the quarterly BAS for your business, however if you have gone over the ATOs annual PAYG Tax withholding threshold, you will now be paying the obligations monthly.

What does this mean?

Towards the end of each month, you will now receive an IAS where you report the total PAYG tax withheld for that month, you will also need to lodge the IAS and pay the obligation by its due date (usually the month after).

You will still be required to complete and lodge a quarterly BAS’, however your PAYG withholding for 1 month (the last month of that quarter) will be included in the BAS.

For example:

Quarter 1= 1 July – 30 September

An IAS will be sent for July & August months.

BAS will still be received for the quarter (towards the end of September)however the PAYG withholding obligation will be included only for September, therefore maintaining the monthly reporting of PAYG tax withholding. The rest of the BAS information will be for the quarter (GST received & paid).

If you have received an IAS and you are not certain how to complete it or would like to discuss it further, please feel free to contact our office. We are here to clarify things for you.

What changed on 1 July?

Here is a reminder of what changed on 1 July 2022

Business

·       Superannuation guarantee increased to 10.5%

·       $450 super guarantee threshold removed for employees aged 18 and over

·       Small business GST and PAYG tax instalments lowered (the total tax liability remains the same, just the
amount the business needs to pay through the year is lowered)

·       ATO guidance on how profits of professional firms are structured comes into effect introducing new
risk criteria

·       New guidance on unpaid trust distributions to corporate beneficiaries comes into effect that may treat
some unpaid distributions as loans and trigger tax consequences

Individuals

·       Superannuation guarantee increased to 10.5%

·       Work-test repealed for those under 75 to make or receive non-concessional or salary sacrifice super
contributions (the work test still applies to personal deductible contributions)

·       Age for downsizer super contributions reduced to 60 years and older

·       Value of voluntary super contributions that can be withdrawn under the First Home Saver Scheme
increased to a total of $50,000

·       New ATO guidelines on trust distributions come into effect primarily impacting distributions to adult
children

·       Home loan guarantee scheme extended to 35,000 per year for first home buyers and 5,000 per year for
single parents

·       Australia’s minimum wage increased