Hi,
Does the ATO recognise if a bank withholds tax throughout the year?
I opened up a Citibank account last month and saw that my first statement included interest, plus tax withheld.
My only concern is that when the ATO processes my return for 2022/23, I may get charged tax on the interest - basically a double-dip of tax.
Hi @sg1fan,
The answer to your first question is yes. Normally for banks to withhold from interest you are earning is due to not having a TFN on file with them.
If you provide the bank with your TFN they will stop withholding tax from the interest. Any TFN withholding they do, they report to the ATO and you can claim it back when you lodge your income tax return. Alternatively, you can claim it back within that financial year directly from the bank. You would have had to provide your TFN to them to do that.
Hi @sg1fan,
The answer to your first question is yes. Normally for banks to withhold from interest you are earning is due to not having a TFN on file with them.
If you provide the bank with your TFN they will stop withholding tax from the interest. Any TFN withholding they do, they report to the ATO and you can claim it back when you lodge your income tax return. Alternatively, you can claim it back within that financial year directly from the bank. You would have had to provide your TFN to them to do that.
Hi Danielle,
Many thanks.
You are quite correct. I contacted the bank and they told me that the TFN I gave them was incorrect (their mistake) so the system automatically went to withholding tax.
Thank you for your response though.
Cheers
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