Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesHot NewsMost Read NewsRecomm.Business LeadersCalendar 

Department of the Treasury - Australian Government : Monthly Company Tax Instalments for Large Companies

share with twitter share with LinkedIn share with facebook
share via e-mail
0
10/22/2012 | 02:56am CET

NO.120

Joint media release with
The Hon Wayne Swan MP
Deputy Prime Minister
Treasurer

Today the Government is announcing a three year process to reform the timing of company tax payments by large companies, better aligning them with GST payments by large businesses.

The total tax paid by companies will not change, but from 1 January 2014 companies with turnover of $1 billion or more will be required to remit their Pay As You Go (PAYG) company tax instalments monthly, not quarterly. Companies with turnover of $100 million or more will have a further one year period to prepare for this change, with monthly payments to start on 1 January 2015. Companies with turnover of $20 million or more will have over three years to prepare for the change, with monthly payments to start on 1 January 2016.

This reform will make the tax system more responsive, efficient, and consistent by better matching tax collections with the economic conditions faced by business. Affected companies will pay smaller tax instalments immediately following months when business is down, and larger instalments when business is strong. It will also align company tax instalments with GST payments to streamline companies' payment cycles.

Most companies are currently required to pay their income tax in four quarterly PAYG company tax instalments, but most large companies are generally required to pay GST in monthly payments. Wage and salary earners have tax withheld from their income as it is earned. Moving large companies to monthly income tax instalments will go a long way to addressing these inconsistencies.

The Government believes that if workers are required to pay tax as they go, then it is reasonable and logical for large companies to do the same. This change continues the reform of the company tax instalment system that began in the late 1980s and complements other initiatives the Government has announced to address timing disparities in the tax system, such as 'loss carry-back', which allows businesses to use losses more flexibly, as well as more timely access to the Research and Development Refundable Tax Offset.

This measure will affect around 350 companies from 1 January 2014, around 2,500 companies from 1 January 2015 and around 10,500 companies from 1 January 2016.

The Government will consult with affected parties to ensure that the reform can be implemented with minimal disruption for businesses.

Taxpayers don't want to over-pay their tax, or be left with an unwieldy tax debt at the end of the year. The Government knows the timing of payments is only one part of this story. Through consultation, the Government is open to additional reforms to the calculation of PAYG instalments that can complement this measure and ensure that total instalments paid throughout the year match as closely as possible to the final tax liability.

A consultation paper will be released by early next year.

22 October 2012

distributed by
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news
Date Title
04:00a Altech Chemicals Ltd Company Presentation (ASX CEO Session)
03:58a Asia stocks steady amid lack of cues; China gains
03:57a ALTECH CHEMICALS LTD (ASX : ATC) Company Presentation (ASX CEO Session)
03:57a NETDIMENSIONS : General Meeting Results and Posting of Offer Doc
03:52a MONEX : Reports Monthly Consolidated Financial Results (IFRS)
03:52a DIMINISHING CITY : hope, despair and Whyalla
03:52a MINISTRY OF FOREIGN AFFAIRS AND TRADE OF REPUB : Foreign Minister Meets with EU’s High Representative for Forei...
03:51a Diamond Resorts Reviews - Exploring California's Palm Desert
03:47a APO ASIAN PRODUCTIVITY ORGANIZATION : promotes sustainable productivity in Africa
03:47a VERIZON COMMUNICATIONS : Don’t break-up over screen cracks! Get back together with your phone and get same-day repairs from Verizon
Latest news
Advertisement
Hot News 
-32.07%Interserve shares slump on higher energy-from-waste exit cost
-12.78%WORLEYPARSONS : CEO Eyes US Oil Sector Turnaround -- Update
-6.56%Unilever PLC Statement re Possible Offer
-4.95%GEMFIELDS : says India's demonetisation drive to hurt full year results
1.96%BANK OF COMMUNICATIONS : China Regulator Has No Objection to Planned Spinoff of Bocom International
Most Read News
07:32pDJFailed $143 Billion Deal Raises Pressure on Unilever, Kraft
09:32p Collapse of Kraft-Unilever tie-up extends run of failed mega-deals
06:32p SAVILLS : Hawthorn Apartment Block is Fully Leased
06:52p CONNEXION MEDIA : 20/02/2017 – Connexion Reaches Gold Status as a Microsoft Partner
08:35pDJUNITED OVERSEAS BANK : Plan to Issue S$750 Million 3.50% Notes Due 2029
Most recommended articles
09:46pDJSM PRIME : 2016 Net Profit PHP23.8 Billion, Up 14% On Year
09:32p Collapse of Kraft-Unilever tie-up extends run of failed mega-deals
09:28pDJCBS : Simon & Schuster Cancels Publication of Milo Yiannopoulos Book
08:58p Toshiba seeking $8.8 billion for majority stake in chip unit
08:47p Toshiba seeking $8.8 billion for majority stake in chip unit - source