Pay As You Go (PAYG) Withholding Tax Tables | Effective for payments made on or after 1 January 2003 | |
Superannuation Pensions & Annuities This document is a withholding schedule made by the Commissioner of Taxation in accordance with sections 15-25 and 15-30 of Schedule 1 to the Taxation Administration Act 1953. It applies to withholding payments covered by section 12-80 of Schedule 1. | ||
Who should use this table?
This table explains how much you must withhold if you make a payment of a superannuation pension or annuity.
The amount to withhold
If the individual has given you his or her tax file number
If the individual receiving the pension or annuity payment has given you his or her tax file number, use the following 2 (two) steps to work out how much you must withhold from the payment.
Step One:
Work out the following amount:
The amount of pension or annuity payment | minus |
In this formula:
Deductible 27H amount means the deductible amount calculated under section 27H of the Income Tax Assessment Act 1936 in respect of the pension or annuity.
If you do not know what the Deductible 27H amount is, the Tax Office will calculate it for you. To arrange for this, the pension recipient or annuitant must send the information set out in TaxPack 2002 at question D10 to the Tax Office with a request to have the amount calculated for them. Further advice is available from the Superannuation Helpline by telephoning 13 10 20; and
Number of instalments means the number of instalments of the pension or annuity payable in the year of income.
Step Two
Work out how much the Pay As You Go Withholding Tax Weekly, Fortnightly, or Monthly Tables (NAT 1005 to NAT 1007) state must be withheld from the amount calculated under the formula above.
Whether you use the Weekly, Fortnightly or Monthly Tax Table to work out how much to withhold will depend on the period for which the pension or annuity is paid. For example, if the pension is paid monthly, you should use the Monthly Tax Table.
Some payees may be eligible to claim the Senior Australians’ Tax Offset (SATO). If the payee gives you a Withholding Declaration indicating that they wish to claim a SATO entitlement through the withholding system, you should use the Special Tax Table
for Aged Pensioners and Low Income Aged Persons – Senior Australians (NAT 4466) to determine the amount to be withheld from the amount calculated under the formula above.
Example:
Shirley retires in January 2001 and will receive a monthly superannuation pension paid on the 15th day of the month commencing on 15 February 2001. For the remainder of the income year the superannuation pension will be $1,200 per month. The pension is indexed annually and the higher indexed amount is paid from 15 July 2001.
Shirley has written to the Tax Office requesting that her deductible 27H amount be calculated. The Tax Office has informed Shirley that her deductible amount for a whole income year is $2,160.00 and for the part of the current income year that she is to receive a superannuation pension, her deductible amount is $930.00.
For the current part of the income year, Shirley will receive 5 payments of pension instalments. The amount of each pension payment that her payer must withhold from will be the following amount:
The amount of pension or annuity payment | minus |
$1,200.00 | – |
$1,200.00 | – | $186.00 |
= $1,014.00 |
|
|
Shirley’s payer will then use the Monthly Pay As You Go Withholding Tax Table (NAT1007) to work out what needs to be withheld from the amount of $1,014.00.
In June 2001, Shirley is told that her pension has been indexed to $1,235.15 per month commencing 15 July 2001. For the 2001/02 income year, the amount of each pension payment that her payer must withhold from each month will be the following amount:
The amount of pension or annuity payment | minus |
$1,235.15 | – |
$1,235.15 | – | $180.00 |
= $1,055.15 |
|
|
Shirley’s payer will then use the Monthly Tax Table (NAT1007) to work out how much to withhold from the amount of $1,055.15.
Important Note – Rebatable Superannuation Pensions & Annuities
If the pension or annuity you pay to an individual is a rebatable superannuation pension or annuity, the amount you must withhold may be reduced by the relevant rebate amount. To find out about this reduction, see below under the heading Rebatable Superannuation Pensions & Eligible Termination Payment (ETP) Annuities.
If the individual has NOT given you his or her tax file number
You must withhold 48.5% of each superannuation pension or annuity payment you make to an individual if he or she is a resident and has not provided you with his or her tax file number.
If the individual is a foreign resident who has not provided you with his or her tax file number, you must withhold 47% of each superannuation pension or annuity payment.
Rebatable Superannuation Pensions and ETP Annuities
If the individual provided a Withholding declaration to you claiming entitlement to a rebate for a superannuation pension or ETP annuity, then special rules apply to work out how much to withhold from:
a rebatable superannuation pension; or
a rebatable ETP annuity.
Pensions and annuities paid by employers are never rebatable.
If you are uncertain whether the superannuation pension or ETP annuity that you are paying is rebatable, you should consult your taxation adviser or contact the Superannuation Helpline on 13 10 20.
The amount to withhold from rebatable superannuation pensions and ETP annuities
If the individual has given you his or her tax file number Rebatable Superannuation Pension (RSP)
The amount you must withhold from payment of a RSP is the amount worked out using the rules above about withholding from superannuation pensions and annuities reduced by the amount calculated using this formula:
15% | [ | amount of RSP - | - | deductible 27H amount | - | s159SS amount | ] | × | rebatable proportion of RSP |
No. of instalments of RSP |
Rebatable ETP Annuity (ETPA)
The amount you must withhold from payment of an ETPA is the amount worked out using the rule above about withholding from superannuation pensions and annuities reduced by the amount calculated using this formula:
15% | [ | amount of ETPA | - | deductible 27H amount | ] | × | rebatable proportion of annuity |
No. of instalments of annuity |
In these formulas:
Deductible 27H amount means the deductible amount calculated under section 27H of the Income Tax Assessment Act 1936 in respect of the pension or annuity.
If you do not know what the Deductible 27H amount is, the Tax Office will calculate it for you. To arrange for this, the pension recipient or annuitant must send the information set out in TaxPack 2002 at question D10 to the Tax Office together with a request to have the amount calculated for them. Further advice is available from the Superannuation Helpline by telephoning 13 10 20; and
Section 159SS amount means the part (if any) of the rebatable superannuation pension that a trustee of a superannuation fund has given the pensioner a notice about under section 159SS of the Income Tax Assessment Act 1936 stating that a specified part of the payment is a non-rebatable amount. In these cases special rules apply — you should seek advice from your taxation adviser or the Superannuation Helpline on 13 10 20; and
Rebatable Proportion of a superannuation pension or ETP annuity is 1 (one) unless the ATO has advised the pensioner/ annuitant that it is a lesser amount.
Example
The superannuation pension that is being paid to Shirley (from the earlier example) is a rebatable superannuation pension. The trustees of the superannuation fund have not given a notice under section 159SS and so there is no s159SS amount. Shirley does not know what her rebatable proportion is. The trustees are to assume the rebatable proportion is 1 (one) unless told otherwise by Shirley or the Tax Office.
The amount that must be withheld from Shirley’s monthly superannuation pension before 1 July 2001 as worked out under the rules above must be reduced by the following amount:
15% | [ | amount of RSP - | - | deductible 27H amount | - | s159SS amount | ] | × | rebatable proportion of RSP |
No. of instalments of RSP |
15% | [ | $ 1 ,200.00 | - | $930.00 | - | $0.00 | ] | × | 1 |
5 |
15% [ $1,014.00 ]
= $152.10
The amount of the superannuation rebate can be greater than the withholding amount previously calculated. When this happens, the withholding amount is nil. The pensioner or annuitant should claim the entire rebate at the appropriate question in his/her tax return.
Following on from this example, the amount to be withheld from the monthly pension of $1,235.15 paid from 1 July 2001 will be reduced by 15% of $1,055.15 which is $158.27.
The amount you must withhold from a rebatable superannuation pension or ETP annuity paid to an individual who has not given their tax file number to you is 48.5% of the payment. While the individual can claim the rebate in his/her personal tax return, this rebate is not taken into account by the payer if the individual has not quoted his/her tax file number.
If the individual is a foreign resident who has not provided you with his or her tax file number, you must withhold 47% of the payment.
Rounding rules
If the amount worked out under the rules above includes a number of cents that is less than a whole dollar, you should round the amount as follows:
Where tax file number provided:
1 to 49 cents rounded down to nearest whole dollar.
For example, if the amount worked out under the table is $250.35, the amount you must withhold is $250.00. 50 to 99 cents rounded up to nearest whole dollar.
For example, if the amount worked out under the table is $250.75, the amount you must withhold is $251.00.
Where tax file number not provided:
Ignore any cents. For example, if the amount worked out is $110.50, the amount you must withhold is $110.00.
For more information
If you have any questions or need more information about calculating the amount to be withheld, you can contact the Tax Office:
— By phone:
— 13 28 66 for general PAYG enquiries or to order Tax Office forms or publications
— 13 10 20 for superannuation and ETP enquiries
Our staff are available during office hours to answer your questions.
— via A Fax from Tax. This service is available 24 hours a day. Call 13 28 60 and follow the instructions to order a catalogue or to be sent information
— at our Internet site, ATOassist: www.ato.gov.au
— in person by visiting one of our ATOaccess shopfronts. Addresses are listed in TaxPack, and in the White Pages telephone directory under ‘Australian Taxation Office’.