Employers to update payroll for new income tax cuts
ATO says it's time for employers to update their payroll to apply tax cuts.
The income tax cuts announced in the 2021 budget breezed through Parliament last week, and the ATO has now published the updated tax tables (https://www.ato.gov.au/Rates/Tax-tables/)
Employers have been given until 16 November 2020 to ensure that they are withholding the correct amount of withholding tax, which means some employees may see the changes reflected in their tax home pay quicker than others.
Any excess withholding tax paid by employees from 1 July 2020 until their wages are updated will be reflected in the assessment of their 2020/21 income tax returns to ensure the correct amount of tax was paid for the financial year.
For further information or assistance with updating your payroll systems contact Nicole at our office.