Under the PAYG withholding system, you may have to withhold amounts from payments you make to workers participating in CDEP.
There are different withholding requirements for workers who only receive CDEP payments and for workers whose wage is made up of both CDEP and non-CDEP payments.
When you only make CDEP payments to your workers
If you only make CDEP payments to your workers:
- you do not withhold amounts from those payments, and
- you will not need to collect a Tax file number declaration from these workers.
When you make both CDEP and non-CDEP payments to your workers
If you make CDEP and non-CDEP payments to your workers as part of their salary and wages, you must withhold amounts from their pay. Refer to Working out how much to withhold.
Tax file number declarations
Workers who receive both CDEP and non-CDEP payments will also need to complete a Tax file number declaration within 14 days of starting work. Once they provide their completed TFN declaration to you, you must:
- complete section B of the original of the declaration
- send the original to us within 14 days of the declaration being made
- keep a copy of the declaration for your records.
You must notify us if a worker has not given you their TFN declaration within 14 days of starting work.
If the worker states at question 1 of their TFN declaration that they have lodged a TFN application or enquiry with us, they have 28 days to give you their TFN.
If the worker has not given you their TFN after 28 days, you must withhold 46.5% of the non-CDEP component of the payment only (unless we tell you not to).