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adminTaccount(Dynamo)Dynamo
19 Sept 2024

Hi,

 

If Michael received his salary for the period from April to June 2023 in July 2023, I understand that the salary will be assessed in FY2024. However, I was wondering if there is any tax offset I can apply in FY2024 for the backpay, given that his taxable income during FY2023 is nil, so if Michael received his salary on time, he wouldn't need to pay tax during FY2023. I understand there is lump sum payment in arrears tax offset, but this can only apply salary and wages accrued during a period ending more than 12 months before the date upon which it was paid.




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244 views
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Deb_ATO(Community Support)Community Support
23 Sept 2024

Hi @adminTaccount


Yep. That's correct. The offset is only eligible to the salary and wages accrued during the period earlier than 12 months before the payment.


If they're eligible and there's amount in the lump sum E section, we'll automatically work it out. But it won't show up in myTax estimate.

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Most helpful reply

Deb_ATO(Community Support)Community Support
23 Sept 2024

Hi @adminTaccount


Yep. That's correct. The offset is only eligible to the salary and wages accrued during the period earlier than 12 months before the payment.


If they're eligible and there's amount in the lump sum E section, we'll automatically work it out. But it won't show up in myTax estimate.

adminTaccount(Dynamo)Dynamo
27 Sept 2024

Hi Deb

,

Thank you for your response.


Regarding the payments that are not dated earlier than 12 months before the payment, is there any special offset available? It seems unfair if it's simply a matter of the employer paying late, resulting in Michael being pushed into another tax bracket.


Looking forward to your insights.



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