ATO 20% PAYG Reduction

5th Feb 2009

ato_home_logo Like many small business owners, I recieved a letter from the ATO to say that due to the Federal Governments recently announced initiative to help small business owners during the “Global financial crisis” that they will have their December Quarter BAS PAYG payment reduced by 20% which would save businesses like mine, hundreds to thousands of dollars.

That was all I read of the 2 page letter, I have more important things to do today- after emailing my accountant, I was quickly informed that it’s not actually a reduction at all, the Government are just letting you pay 20% less, but you will still need to pay it in a few months time when your income tax is due.

So basically – there is no REAL finanical gain in this at all, rather than paying $2500 now, you only need to pay something like $2100 – and pay us that other $400 later.

Thanks for the false hope ATO.

4 comments

Ben,
You should know by now death and taxes are obligatory. I have never worried about paying tax, because I know the more tax I pay the more money I have made.
I don’t know why people are obsessed with tax cuts?
Taxes are what pays for our infrastructure, no taxes and the whole bloody place will fall over.

Jonangel on 5th February, 2009 at 4:54 pm
Jon I agree with you on this

Ben May on 6th February, 2009 at 7:27 am
I agree that taxes are inevitable and that they pay for many things we take for granted. However, seeing as the economy has taken a downturn and there are many handouts for families and children etc, the idea that a 20% reduction may apply for the stuggling small business owner was exciting but as usual, short lived!

Shannon on 11th February, 2009 at 1:48 pm
Of course you will still have to pay the full tax at the end of the year. The whole point is to increase cashflow now when you can use the money. It also recognises that many businesses are expecting reduced profit, so it allows that now instead of waiting 12 months for your tax return. If your business is going great, go ahead and pay the whole amount now.

Steve on 21st February, 2009 at 1:17 pm