The Australian Taxation Office (ATO) have updated the PAYG withholding tax tables to reflect the income tax cuts announced in the Budget last week.
Whilst the tax rate cuts are back-dated to 1 July 2020, there will be no adjustment for any excess amounts withheld on salary and wages to October 2020. Individuals will receive a refund of any excess amounts withheld on lodgement of their 2021 income tax return.
The updated PAYG withholding tax tables apply to payments made from 13 October and employers will have until 16 November to implement these changes.
Software providers will be updating their withholding schedules in due course, however it is possible to manually calculate the tax to be deducted from an employee’s pay using the ATO withholding schedules before that occurs.
The PAYG withholding tax tables can be accessed here.
Please contact your Moore Australia advisor today if you have any queries.