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Penalties and interest
If your organisation doesn't pay tax in full and on time, we'll charge late payment penalties and interest. Additionally, some actions, such as not providing accurate information, may attract shortfall penalties and/or other penalties. By working with us, any potential penalties may be reduced.
If your organisation doesn't pay tax in full and on time, we'll charge late payment penalties and interest on amounts over $100. There are several steps we'll take to recover the amount owing.
A payment is late if it is posted or delivered to us after the due date. Penalties are not charged on unpaid amounts less than $100.
Shortfall penalties apply to most taxes and duties and are imposed as a percentage of a deficit or understatement of tax. There are six categories of fault, with each carrying a specified penalty rate.
Any registered person who does not comply with the tax laws commits an offence. The penalties apply to all taxes and duties, including PAYE deductions, GST, fringe benefit tax (FBT), employers’ deductions of child support and student loan repayments. The consequences of committing an offence are penalties and/or imprisonment. The types of offences and associated penalties are explained.
Interest applies when you either overpay or underpay the amount that is due. If you overpay the amount due we will generally pay you interest from the day after the original due date.
If this is your first late payment in a two-year period, you will be allowed a grace period. This means that you will have a further period to make payment, without incurring a late payment penalty. If you do not pay within the grace period, the late payment penalty will be imposed from the due date. Interest will continue to apply.
If you file your employer monthly schedule without payment, you may have to pay non-payment penalties as well as late payment penalties.