INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART VI - COLLECTION AND RECOVERY OF TAX  

Division 2 - Collection by instalments of tax on persons other than companies  

SECTION 221EAA   FAILURE TO MAKE DEDUCTIONS FROM SALARY OR WAGES  

221EAA(1)   [Liability to pay penalty amount]  

If an employer, other than a government body, paying salary or wages to an employee does not deduct from the salary or wages the amount required to be deducted under this Division, the employer is liable to pay to the Commissioner an amount, by way of penalty, equal to the amount not deducted.

221EAA(2)   [When penalty amount to be paid]  

The employer must pay the penalty amount by the time by which, if the employer had deducted the amount required to be deducted, the employer would have been required to pay that amount to the Commissioner.

221EAA(3)   [General interest charge payable on overdue amount]  

If any of the penalty amount remains unpaid after the time by which it is due to be paid, the employer is liable to pay the general interest charge on the unpaid penalty amount for each day in the period that:

(a) started at the beginning of the day by which the penalty amount was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid;

(i) the penalty amount;

(ii) general interest charge on any of the penalty amount.

Note:

The general interest charge is worked out under Division 1 of Part IIA of the Taxation Administration Act 1953 .

221EAA(4)   Government bodies.  

If a government body paying salary or wages to an employee does not deduct from the salary or wages the amount required to be deducted under this Division, the government body is liable to pay the general interest charge on the amount not deducted for each day in the period that:

(a) started at the beginning of the day by which the government body was required to deduct the amount; and

(b) finishes at the end of 30 June in the financial year in which that day occurred.

Note:

The general interest charge does not apply to the Commonwealth or authorities of the Commonwealth: see subsection 8AAB(3) of the Taxation Administration Act 1953 .