Hi
I think I asked this question a long time ago and I can’t find it now. I know there is a form I can get from the ATO that will enable me to pay less tax on my pay check every month. How does it work and is it a good idea.
Thanks
I dont do it. I use it as compulsory savings. I am using my tax refund this year to take the family to Canada.
you must get a pretty big refund if you can do that…I don’t know how it works so maybe you can explain to me..is it mainly to help with repayments the extra money or what is the main idea there…?
I have a few negative geared and neutreul greared properties. Once all expenses are deducted I get a good tax refund as I am on the highest tax bracket.
I understand you can fill out a form 221D (or something like that – only going on memory) and you can have your tax deducted at a lower rate every pay packet. It does help cash flow but there are penalties if you stuff up your calculations.
Its probably why I am one of the few who look forward to doing his tax return.
yack I am on a pretty low income so it will prob make sence for me to get that sort of thing going for me. When you say stuff up your calculations what are you revering to there
I believe there are penalties if you have to end up paying the ATO the tax back when you do your income tax return at the end of the year.
So you need to be conservative when estimating your likley deductions and decide on how much extra you want in your monthly pay.
I think the form 221D has been renamed.
If it is the capital allowances schedule, the URL from the ATO is http://www.ato.gov.au/content/downloads/NAT4089-03.pdf
Cheers,
Shushar“All our dreams can come true, if we have the courage to pursue them.” – Walt Disney
You can do it yourself or get an accountants assistance (for a price) obvioulsy. The 221D from is now called Section 15-15. The actual form you need to fill out and submit is on
http://www.ato.gov.au/content/downloads/NAT2036e2004.pdfJames
Thanks James
[
]“All our dreams can come true, if we have the courage to pursue them.” – Walt Disney
Cornel,
The document’s name is 2004 PAYG Income Tax Withholding Variation (ITWW) Application
To get it from the ATO you need to quote
NAT5422-3.2003Julia
I’m the same as Yack..
I see the benefit’s in getting more in your pocket each week but prefer the lump sum come tax time..”forced savings’, i then use it to reduce my Non-deductable debt ( PPOR )
If you get paid more each week you just use/lose it with bills etc..
REDWING
“The man that thinks at 5o as he did when he was 20 has wasted 30 years of his life”
Of course the extra monies can be funnelled into an offset account on your PPOP to reduce interest payments each and every day!!
James
so the best will prob be to just leave it as it is and get a bigger tax return…thanks for the comments
Using Tax as a form of compulsory savings is not a good idea; the Tax department doesn’t pay interest.
I think georgisj’s idea of using the money in an offset account is a better idea.
The quickest way to create wealth is to complete the PAYG variation form and receive your tax refund on a weekly basis, rather than a lump sum at the end of the year.
Your interest in your PPOR is a non deductable form of interest, so you want to reduce it as quickly as possible. Adding as little as $10 per week to your weekly repayments makes a huge difference in your total repayments and shortens the length of your loan considerably.
When I last claimed my weekly refund (it was still the 221D form then) I kept it in a separate account, and used that account to pay all property expenses. it worked out well then (I only had two properties).
I think I should submit it again, as it’s February now, and I still haven’t done last years tax return! I’m expecting a refund of $11K, so I really need to get on and do it[
], and stop being so slack[V]Cheers
Mel
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