DIVIDENDS AND TAX
PAYG Instalments (Individual)
Hi Everyone, This year I have been automatically opted into Quarterly activity statements due to personnel investments (ETF’s + bank interest). I was not aware such a scheme existed and haven’t heard it mentioned in the community/ podcasts before… I am now aware that: Individuals are obliged to pay PAYG installments if their most recent tax return shows more than $4,000 in gross investment and the tax due on your most recent notice of assessment was more than $1,000… I was wondering how others navigate this quarterly bill and there approach (understandable if an advisor were to be involved)… Do others budget/put aside for this each week? (and reduce there savings rate/investments rate) or supplement it from other “buckets” and top up at tax time? This is new to me and would love some more conversation around this.. Thank you
2 Comments
5 months ago
Hi John,
Most people would simply use their ongoing savings to pay for the bill, since it should only equate to a portion of investment income over the period.
So most often, it means the investor just has less to invest when the bill is due. I don’t personally ‘put aside’ money for that, but rather it just means less is able to be invested, similar to if there was a different household bill that needed paying.
But it depends on how you like to plan/account for things. I’d say most people would just pay it as described, though some people might prefer to take from a different ‘bucket’ if they do that, but it really makes little difference at the end of the day.
Cheers, Dave
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