The Small Business Minister has announced changes to the pay as you go (PAYG) instalments entry and exit thresholds.
From 1 July 2014, PAYG instalment thresholds will increase, which may mean clients no longer need to pay instalments.
The entry and exit thresholds for:
- business or investment income will increase from $2,000 to $4,000
- adjusted balance of assessment will increase from $500 to $1,000
- notional tax will increase from $250 to $500.
There will no longer be a requirement for entities registered for GST to remain in the system if they have a zero instalment rate.
If clients no longer meet the entry rules they will be automatically exited from the PAYG instalments system. The ATO will send a letter to notify agents of their clients’ automatic withdrawal.
If clients have received a recent activity statement they will be required to make payment by the due date, as this is for the quarter from 1 March 2014 to 30 June 2014.
If clients want to continue to pay instalments towards their end of year tax liability, they can voluntarily re-enter the PAYG instalment system. Agents can phone the ATO on 13 72 86 Fast Key Code 2 1 1 and request the client is manually entered to the PAYG instalment system.
For more information go here.