spacer spacer spacer spacer spacer spacer spacer spacer
spacer
spacer
    Latest Accounting News

Telephone: 03 9727 1244
Facsimile: 03 9727 0244
Email: Email Us

Address: Suite 2, 96 Manchester Rd, Mooroolbark VIC 3138
spacer
Hot Issues
Part 1 – Budget reminders. Under the Hood.
Part 2 – Budget reminders. Under the Hood.
Part 3 – Budget reminders. Under the Hood.
Comprehensive list of COVID-19 initiatives and packages.
Businesses not meeting obligations warned as ATO restarts compliance programs
Employers cautioned over ‘hard and fast’ decline in turnover eligibility
‘Follow the spirt of the law’, warns ATO
$120m in JobKeeper clawed back by ATO, new compliance areas highlighted
Budget 2020 - A very comprehensive break down.
Budget 2020 - Fact Sheets
Budget 2020 - At a Glance, Overview, Outlook
Temporary home office expenses shortcut extended again
JobKeeper extension – changes implemented
JobKeeper Participants – are “workers”
Commissioner registers updated JobKeeper alternative tests
Varying Pay As You Go (PAYG) Instalments
Reminder of Medicare Levy Surcharge (MLS)
September update of latest COVID-19 initiatives.
ATO JobKeeper 2.0 guidance surfaces
Expats Return to Australia – Travel Expenses
Profession to be relied on for post-JobKeeper turnover certificates
Update of Superannuation contribution rules from July 1, 2020
Expats & COVID-19 Impacts on tax residency
Economic recovery could be slower than anticipated: RBA
High Court rules in favour of employers on personal leave accruals
JobKeeper Phase 2 - Latest Update
Articles archive
Quarter 3 July - September 2020
Quarter 2 April - June 2020
Quarter 1 January - March 2020
Quarter 4 October - December 2019
Quarter 3 July - September 2019
Quarter 2 April - June 2019
Quarter 1 January - March 2019
Quarter 4 October - December 2018
Quarter 3 July - September 2018
Quarter 2 April - June 2018
Quarter 1 January - March 2018
Quarter 4 October - December 2017
Quarter 3 July - September 2017
Quarter 2 April - June 2017
Quarter 1 January - March 2017
Quarter 4 October - December 2016
Quarter 3 July - September 2016
Quarter 2 April - June 2016
Quarter 1 January - March 2016
Quarter 4 October - December 2015
Quarter 3 July - September 2015
Quarter 2 April - June 2015
Quarter 1 January - March 2015
Quarter 4 October - December 2014
Quarter 4 of 2015
Articles
FBT – Christmas Parties and Taxi Fares
Merry Christmas for 2015 and Happy New Year.
Common errors in claiming deductions for super contributions
Employee Christmas Parties and Gifts – Any FBT?
Collectables Require Action Now
Why the ATO’s new powers make SMSF compliance more important than ever
Self Managed Superannuation Funds – Is it for Retirement?
ATO warns against misusing partnerships
The Scammers Shame
ATO offers SMSF 'unwinding' for aggressive tax arrangements
Salary and Wages PAYG Shortfall
SuperStream
Australian Taxation Office (ATO) Telephone Scammers – BEWARE!
Navigating the BDBN minefield
SMSFs warned on emerging LRBA issue
Short Access to Term Deposits
Retirees taking super in lump sum is a ‘myth'
Salary and Wages PAYG Shortfall

Many taxpayers will owe tax in July 2016, instead of receive a refund.



       

It is likely this financial year that there will be an extra pay period.


  • fortnightly – will have 27 pay days for the year instead of the usual 26
  • weekly – will have 53 pay days for the year instead of the usual 52

The withholding tax tables calculated by the Australian Taxation Office are based on the normal number of pays in a year.  Tax rates increase as a taxable income increase.  Therefore, the additional pay day will mean that amounts withheld from salary or wage payments made to many payees will not cover the amount payable when they lodge their tax returns.


What can be done?


The Australian Taxation Office recommends that additional amounts can be withheld.


Every taxpayer’s circumstances are different, but those who normally expect to receive a small refund at the end of the year are likely to find that they owe tax, because of the additional pay day.  Any payees concerned about the possible shortfall in amounts withheld, can request additional amounts.  The recommendations are:-


Weekly earnings

Additional withholding per pay

$725 to $1,524

$3

$1,525 to $3,449

$4

$3,450 and over

$10


 


 


Fortnightly  earnings

Additional withholding per pay

$1,400 to $3,049

$12

$3,050 to $6,799

$17

$6,800 and over

$42


 


An email request to the pay office should be enough.  But don’t wait too long!


If you think this difference would be insignificant, then think again!  An average taxpayer earning $3,200 per fortnight will be $482 out of pocket, when they lodge their 2016 income tax return.


For a normal, 26 fortnight year, the taxpayer would receive a refund of $41 on assessment of their tax return.  In a 27 fortnight year, they would face a bill of $421, which would be the tax payable on assessment.


This example uses 2015-16 tax rates.  It assumes the payee has no other income or deductions and is not entitled to leave loading.


Speak to the pay office immediately!


 


Source:  Written for AcctWeb by a Melbourne accounting practice




22nd-November-2015
 
sitemap | site by AcctWeb