PAYG is a system for making regular payments towards your expected annual income tax liability for your SMSF and is applied after your first annual return is lodged. Your payments during the year are based on the previous year’s tax payable, and any amount paid is credited against the next years tax payable.
PAYG are generally paid quarterly and the ATO will send you a statement to your registered address which will need to be paid on time and the form will be returned to the ATO.
It is the responsibility of the member(s) to maintain their SMSF PAYG obligations.
A working example
For the year ended 30 June 2016, ABC SMSF has income tax payable of $1000. The ATO will expect a PAYG instalment on a quarterly basis of $250 per quarter which is obviously $1000 divided by 4. This will be included in the activity statement received at the funds registered address. The amount can be varied based on expected tax payable in the current year.
Read More here https://www.ato.gov.au/General/PAYG-instalments/
Please note this article is for information purposes only and does not constitute financial or legal advice. Should you have any queries or require more information, please contact the team at Redwood on 1300 790 110.
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