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Pay As You Go (PAYG) Withholding

Pay As You Go (PAYG) withholding is a system for withholding amounts from payments you make to employees and businesses so they can meet their end of year tax liabilities. 

You need to withhold payment amounts from:

  • Employees, company directors, and office holders
  • Labour hire arrangements
  • Voluntary agreements
  • Persons  unable to work (eg due to sickness or accident)
  • Where an Australian Business Number (ABN) has not been quoted

If you withhold amounts from payments, you need to:

  • Register for PAYG withholding
  • Withhold amounts from wages and other payments
  • Lodge activity statements and make payments to the ATO
  • Provide payment summaries to workers
  • Provide the ATO with a PAYG withholding payment summary annual report

For further information, see PAYG Withholding