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Questions about PAYG witholding?

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Initiate

Views 296

Replies 3

Hi!

 

I have a few questions about PAYG witholding....

 

I'm a sole trader who makes FREE TO PLAY video games online for the public to download and play offline.

 

After successfully obtaining my ABN, I have the intention on starting to make my first commercial game to sell to the public.

 

My first step though, is to apply for PAYG witholding so I can commission the people who work on my commercial game, and withold tax on their behalf as most do their freelance work without a business license, and for FREE

 

Most of the people I am looking to work with on making my first commercial game are graphic designers, voice actors and music composers, and most of them live overseas in the U.S. or U.K. etc. (outside Australia).

 

So here are my questions:

 

1. When I have to declare the amount I'm witholding to the ATO, come tax time, do I need to declare amounts separately for each freelancer I work with or am I able to combine the total amounts for all the freelance workers I work with?

 

2. How do I know how much tax to withold for each freelancer?

 

3. Are Freelancers considered as contractors or employees or something else? Because it's likely that I will be working with different Freelancers for each Game I make and these people will only receive one-time fixed commissions for their work.

 

4. This may sound like a silly question but...is there a fee for applying/ monthly fee for having PAYG witholding?

 

Thanks!

 

-IndiegameDEV   

1 ACCEPTED SOLUTION

Accepted Solutions
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Best answer

Community Manager

Replies 2

 

Hi @IndiegameDEV

 

Basically when you are registered for PAYG withholding you have an obligation to lodge activity statements each month or quarter where you report the amounts you have withheld for that period. I strongly recommend you read our PAYG withholding information on our website as it will also give you links to other relevant information you will need to know.

 

Withholding does mean you pay tax on their behalf and if they are foreign residents you can find

withholding information for foreign residents here.

 

There are no fees.

 

Hope this helps

 

3 REPLIES 3
Highlighted

Best answer

Community Manager

Replies 2

 

Hi @IndiegameDEV

 

Basically when you are registered for PAYG withholding you have an obligation to lodge activity statements each month or quarter where you report the amounts you have withheld for that period. I strongly recommend you read our PAYG withholding information on our website as it will also give you links to other relevant information you will need to know.

 

Withholding does mean you pay tax on their behalf and if they are foreign residents you can find

withholding information for foreign residents here.

 

There are no fees.

 

Hope this helps

 

Highlighted

Initiate

Replies 1

Hi Kylie!

 

Thank you for answering my question and for providing helpful information links!

 

I was also wondering, if the foreign residents I commission through paypal from the U.S. provide me with their TIN (Tax Identification Number) or are from the U.K. and they provide me with their NIN (National Insurance Number), do I still need to withold tax on their behalf?

 

Thanks!

 

-IndiegameDEV

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ATO Certified

Community Support

Replies 0

Hi @IndiegameDEV

 

Check out payments to foreign residents to work out if you need to withhold.

 

Regards,

Ari