Withhold PAYG from employee and contractor payments
Employers must withhold tax from wages, certain contractor payments + report via STP / BAS.
Who must comply
Employers + payers of withholding-attracting payments.
What triggers it
Making a payment subject to PAYG withholding.
When due
Withhold each pay event; remit via BAS.
Evidence required
TFN declarations; STP submissions; BAS withholding payments.
Max penalty
Failure-to-withhold penalty 75% of unpaid; director penalty notices for unremitted withholding
Summary
PAYG withholding obligations apply to wages (per TFN declaration), contractor payments where the contractor has not quoted ABN (47%), and various other payments (e.g. directors' fees, royalties). Withheld amounts reported via STP + remitted to ATO via BAS.
Enforced by
Source legislation
Topics
Source: https://ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/paying-your-workers. Rules Mate is not a law firm. Always verify against the live regulator source before acting.