19. Do I have to pay Employee withholdings tax PAYGW?

You need to withhold payment amounts:

  • From payments you make to other workers who do not qualify as independent contractors;
  • From payments you make to other businesses if they don't quote their ABN to you on an invoice or another document;
  • From payments you make to your company directors for their services;
  • If you are an employee of your own company;
  • If you have employees;
  • If you pay employees from another business
  • If you make a payment under a labour hire arrangement
  • If you make a payment otherwise specified by regulations.

If you are an employer or run a business and withhold amounts from payments, you need to:

  • Register for PAYG withholding;
  • Determine the status of your workers (if applicable);
  • Familiarise yourself with the types of payments you need to withhold amounts;
  • Determine the amounts to withhold;
  • Report and pay withheld amounts to the ATO;
  • Provide the ATO with payment summaries;
  • Lodge an annual report once each income year has ended.

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