The ATO said “Some taxpayers are incorrectly varying their pay as you go (PAYG) instalment rate or amount. This may result in a debt at the end of the financial year and attract a general interest charge (GIC) if the variation was significantly incorrect.
“We may contact you to discuss your clients PAYG instalment variations and how to help them get it right.”
It recommended that BAS Agents and other advisers advise their clients they may have to pay GIC if they vary an instalment rate or amount to less than 85% of the:
• actual tax payable on their business and/or investment income for the income year
• instalment rate that should have applied for the income year
Clients should vary their rate up if they think they underestimated their rate or amount, the ATO said.
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