PAYG

PAYG

PAYG stands for ‘Pay as you go’ and it’s where an employer withholds the tax from an individual’s pay/income and pays it in installments to the ATO (Australian Tax Office). It helps the employee meet there end of year tax liability and is based on the expected annual income.

You use pay as you go (PAYG) installments to make regular prepayments of the tax on your business and investment income.

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The instalment rate calculation is: (Estimated tax ÷ instalment income) × 100

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