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klveyj88(Newbie)Newbie
23 Jan 2025

Hi, my partner received a defence force retention bonus in 2018/2019 on the proviso that he serve a further 6 years, due to personal reasons he only served 5 of those years until 23/24 and had to pay back to defence the balance of the time not served on the bonus. The bonus was paid to my partner by defence in full in 2018/2019 and he was taxed the full amount when the bonus was paid. When he paid back the time not served portion of the bonus he was taxed again, which means that he has now overpaid approximately 8K in tax (he has now paid tax twice on one amount). Is he able to apply to the ATO to have this tax reimbursed?

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2 replies
147 views
2 replies

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AriATO(Community Support)Community Support
7 Feb 2025

Hi @klveyj88


This sounds like it'd be treated the same as an overpayment. Your partners employer should issue them with an amended payment summary for 2018/2019 showing the amounts they should've received but keep the tax withheld the same.


Your partner would then need to amend the relevant tax return. Since it's out of the time limit to amend they can look at lodging an objection.


Check out overpayment relates to a previous financial year for further info.

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klveyj88(Newbie)Newbie
23 Jan 2025

I do apologise I am not a tax person and may have worded the above question incorrectly. so I will try to show this in an example: (these are only example figures)

2018/2019 received 6yr retention bonus of $120,000 - $40,000 tax = $80.000 bonus (net). This was processed through the 2018/2019 income tax assessment on top of normal wages.

2022/2023 as full retention was not completed (5years done only) $20,000 (pro rata cost) was paid back by us to defence, which means the overall bonus was for $100,000 and not $120,000.

As the tax of $40,000 was paid on the full amount of $120,000 in 2018/2019 but $20,000 was paid back in 2022/2023, does this now mean that the tax was overpaid and is there anything we can do to have this rectified?

Most helpful reply

AriATO(Community Support)Community Support
7 Feb 2025

Hi @klveyj88


This sounds like it'd be treated the same as an overpayment. Your partners employer should issue them with an amended payment summary for 2018/2019 showing the amounts they should've received but keep the tax withheld the same.


Your partner would then need to amend the relevant tax return. Since it's out of the time limit to amend they can look at lodging an objection.


Check out overpayment relates to a previous financial year for further info.

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