PAYG Withholding

You need to withhold payment amounts:

  • From payments you make to other workers (eg contractors)
  • From payments you make to other businesses if they don't quote their ABN to you on an invoice or another document
  • From payments you make to your company directors for their service to you 
  • If you run your business as a company
  • If you have employees
  • If you pay employees from another business

If you are an employer or run a business and withhold amounts from payments, you need to:

  • Register for PAYG withholding
  • Determine the status of your workers (if applicable)
  • Familiarise yourself with the types of payments you need to withhold amounts from
  • Determine the amounts to withhold
  • Report and pay withheld amounts to the ATO
  • Provide the ATO with payment summaries
  • Lodge an annual report once each income year has ended

MORE: See the PAYG Withholding section of the ATO website.