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
12:56p TWENTY FIRST CENTURY FOX : Some shareholders unhappy over terms of Murdoch's Sky bid - report
12:54p BOEING : deal likely to double Iranian aviation fleet's seats
12:53pDJHYUNDAI MERCHANT MARINE : Enters Into Limited Cargo Agreement With 2 Million Alliance
12:48p RUPERT MURDOCH : Some shareholders unhappy over terms of Murdoch's Sky bid
12:41p SAUDI ARABIA, IRAQ BOOST OIL OUTPUT IN NOVEMBER : OPEC sources
12:40p VISIT HELSINKI : Helsinki Supports Saara Aalto, The X Factor UK finalist
12:39p Taj and Shangri-La hotel chains form groundbreaking alliance
12:37p Russia signs Rosneft deal with Qatar, Glencore
12:36p GENERAL MOTORS : Cadillac disavows casting call for 'neo-Nazi' character in brand ad
12:29p SCHWEIZERISCHE NATIONALBANK : Weekly Economic & Political Timeline
Latest news
Advertisement
Hot News 
-18.13%RESTORATION HARDWARE : Hit by Business-Model Changes
1.99%BANK OF CHINA : Leads Bailout of Troubled Steel Trader
4.83%France's Elior eyes further profit, sales growth
-7.04%Macau eases gambling crackdown concerns after casino shares tumble
-14.17%SIBANYE GOLD : to Buy Stillwater Mining for $2.2 Billion--Update
Most Read News
06:37a Russia signs Rosneft deal with Qatar, Glencore
12/10 RUSSIA-FRIENDLY CEO MAY BECOME TRUMP’S SECY OF STATE : Report
12/10 GENERAL MOTORS : Cadillac disavows casting call for 'neo-Nazi' character in brand ad
05:47a IRAN SIGNS $16.6 BILLION DEAL FOR 80 BOEING PLANES : Irna
12/10 SWISSCOM : 09 December 2016 Renzo Simoni is chosen to represent Swiss government on Board of Directors
Most recommended articles
06:56a TWENTY FIRST CENTURY FOX : Some shareholders unhappy over terms of Murdoch's Sky bid - report
06:53aDJHYUNDAI MERCHANT MARINE : Enters Into Limited Cargo Agreement With 2 Million Alliance
06:48a RUPERT MURDOCH : Some shareholders unhappy over terms of Murdoch's Sky bid
06:37a Russia signs Rosneft deal with Qatar, Glencore
05:47a IRAN SIGNS $16.6 BILLION DEAL FOR 80 BOEING PLANES : Irna