Pay As You Go Withholding Non‑compliance Tax Act 2012
No. 95, 2012
An Act to impose a tax on directors, and associates of directors, of companies that do not comply with their Pay as you go (PAYG) withholding obligations, and for related purposes
Contents
1 Short title
2 Commencement
3 Imposition of tax
4 Amount of tax
Pay As You Go Withholding Non-compliance Tax Act 2012
No. 95, 2012
An Act to impose a tax on directors, and associates of directors, of companies that do not comply with their Pay as you go (PAYG) withholding obligations, and for related purposes
[Assented to 29 June 2012]
The Parliament of Australia enacts:
1 Short title
This Act may be cited as the Pay As You Go Withholding Non‑compliance Tax Act 2012.
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information |
Column 1 | Column 2 | Column 3 |
Provision(s) | Commencement | Date/Details |
1. Sections 1 and 2 and anything in this Act not elsewhere covered by this table | The day this Act receives the Royal Assent. | 29 June 2012 |
2. Sections 3 and 4 | At the same time as Part 2 of Schedule 1 to the Tax Laws Amendment (2012 Measures No. 2) Act 2012 commences. | 30 June 2012 |
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
3 Imposition of tax
Pay as you go withholding non‑compliance tax payable in accordance with Subdivision 18‑D in Schedule 1 to the Taxation Administration Act 1953 is imposed.
4 Amount of tax
The amount of the tax imposed by this Act is the amount of Pay as you go withholding non‑compliance tax payable in accordance with that Subdivision.
[Minister’s second reading speech made in—
House of Representatives on 24 May 2012
Senate on 21 June 2012]
Overview
The Pay As You Go Withholding Non-compliance Tax Act 2012 was enacted by the Parliament of Australia to address the issue of non-compliance by companies with their Pay As You Go (PAYG) withholding obligations. The Act imposes a tax on directors, and associates of directors, of companies that fail to meet these obligations. The Act's policy objective is to encourage compliance with PAYG withholding obligations by imposing a financial penalty on non-compliant companies. The tax is payable in accordance with Subdivision 18-D in Schedule 1 to the Taxation Administration Act 1953, with the amount of the tax determined by the PAYG withholding non-compliance tax payable under that Subdivision.
The Act commenced on 29 June 2012, with certain provisions coming into effect on 30 June 2012. The imposition of the tax is intended to serve as a deterrent to non-compliance and to encourage companies to meet their PAYG withholding obligations. The Act applies to directors and associates of companies that fail to comply with their PAYG withholding obligations, and the tax is imposed in addition to any other penalties or fines that may be applicable.
Scope and Application
The Pay As You Go Withholding Non-compliance Tax Act 2012 applies to directors and associates of directors of companies that fail to comply with their PAYG withholding obligations. The Act imposes a tax on these individuals to ensure compliance with tax withholding requirements. This legislation commenced on 29 June 2012 for sections 1 and 2, and on 30 June 2012 for sections 3 and 4, aligning with the commencement of Part 2 of Schedule 1 to the Tax Laws Amendment (2012 Measures No. 2) Act 2012. The tax is levied under Subdivision 18-D in Schedule 1 to the Taxation Administration Act 1953, with the amount of tax determined according to the provisions of that Subdivision. The scope of the Act is national, applying across Australia, and it extends to any entity or individual within the specified categories, ensuring a comprehensive approach to enforcing PAYG withholding compliance.
Key Provisions
The Pay As You Go Withholding Non-compliance Tax Act 2012 (sections 3 and 4) imposes a tax on directors and associates of directors of companies that do not comply with their PAYG withholding obligations. This tax is payable in accordance with Subdivision 18-D in Schedule 1 to the Taxation Administration Act 1953. The tax amount is determined based on the PAYG withholding non-compliance tax payable under that Subdivision. The Act outlines the financial consequences for those who fail to meet their withholding obligations and mandates that these taxes be paid as stipulated.
The Act imposes specific obligations on directors and associates of directors of companies that do not comply with their PAYG withholding obligations. These obligations include ensuring that the correct amount of PAYG withholding tax is calculated and remitted to the Australian Taxation Office. Companies and their directors are required to maintain proper records and documentation to substantiate their withholding tax payments. Additionally, they must be aware of the tax implications of non-compliance and take proactive steps to avoid penalties.
Failure to comply with the obligations outlined in the Pay As You Go Withholding Non-compliance Tax Act 2012 can result in severe consequences. The Act establishes offences for non-compliance, with potential penalties including fines and imprisonment. The specific penalties are detailed in the Taxation Administration Act 1953, which provides a framework for the enforcement of PAYG withholding taxes. The maximum penalties can be substantial, reflecting the seriousness with which the Australian government views tax non-compliance.