Failure to withhold
To correct a mistake when you did not withhold PAYG withholding amounts from a payment, or you withheld the wrong amount, you need to write to us. You should not include any amount that you failed to withhold on either an original or a revised activity statement.
By writing to us you are making a voluntary disclosure which gives you the opportunity to correct your tax obligations. If you have failed to withhold an amount from wages to an employee you could lose your deduction unless you make a voluntary disclosure.
To find out how to write to us, see What to include in your letter.
Failure to notify
If you withheld the correct amount of PAYG withholding, but made a mistake reporting it, or failed to report it when you should have, you need to correct the mistake.
For amounts that are not reported through Single Touch Payroll (STP), you need to lodge a revised activity statement. To correct a mistake where PAYG withholding amounts were overstated you also need to lodge a revised activity statement.
For amounts that are reported through STP, you may need to make corrections in either or both your STP reporting and your activity statement. To find out how, see Correcting information reported through STP.
Voluntary disclosure
If you revise an earlier activity statement and the revision increases the tax you owe, or you advise us by letter that you've not withheld an amount from a payment, we generally treat the revised activity statement or letter as a voluntary disclosure. This means you're likely to receive concessional treatment for any penalties and interest charges that apply and you won't lose your deduction.
What to include in your letter
When you write to advise us of an amount you didn't withhold from a payment, include the following information:
- the title 'Voluntary disclosure – PAYG withholding'
- your name or your business name – that is, the full name of the taxpayer that should have withheld the amount
- your phone number and address or the name, phone number and address of your authorised contact or tax agent
- the name of the person or organisation you made the payment to
- the date you made the payment
- what the payment amount was
- what the amount you should have withheld was, or an estimate of what it should have been
- a taxpayer signed and dated declaration as follows
- I declare the information I have given in this letter, including attachments, is true and correct and that I am authorised to disclose this information.
your signature
the date, or
- I declare the information I have given in this letter, including attachments, is true and correct and that I am authorised to disclose this information.
- a tax agent signed and dated declaration as follows
- I declare that this form has been prepared in accordance with information provided by the taxpayer has given me a declaration stating that the information provided to me is true and correct and that the taxpayer has authorised me to lodge this form.
name of tax agent
tax agent registration number
tax agent signature
the date.
- I declare that this form has been prepared in accordance with information provided by the taxpayer has given me a declaration stating that the information provided to me is true and correct and that the taxpayer has authorised me to lodge this form.
Keep a copy of the letter for your records.
Mail your letter to us at:
Australian Taxation Office
PO Box 3575
ALBURY NSW 2640
Your tax agent can also make a voluntary disclosure on your behalf by sending the required information though an ATO approved electronic channel. The tax agent will need to ensure that their tax agent number is linked to your records.
Income statement and payment summary corrections
If you've made a mistake and have already finalised STP records or issued income statements or payment summaries to your payees for the period that the error was made, you may need to correct them.
If you identify the need to amend details after making a finalisation declaration you should submit these as soon as possible. You can do this by submitting an update event.
Submitting an update event will ensure the correct information is reflected in your employee's income statement.
If you have issued payment summaries for amounts not reported through STP, you will also need to revise your payment summary statement or payment summary annual report, or both.
How to correct a mistake with the PAYG amount withheld or reported on your activity statement.