PAYG (prepayment of income tax)

The tax office calculates a prepayment of income tax based on the previously lodged income tax return.

This is calculated on a quarterly basis and added to the quarterly BAS lodgement, e.g. if there was a tax liability of $12,000 based on the previously year’s income tax return. The tax office would calculate $3000 per quarter payable with the 1st, 2nd, 3rd and 4th BAS.

When the next years income tax is lodged if there is an over payment – there is a refund due.