On 8 September 2022, the Australian Taxation Office (ATO) published a notice in respect of obligations when making interest, dividend, or royalty payments to foreign residents. Taxpayers who have paid interest, dividends or royalties to a foreign resident must meet certain obligations, including:
- lodging a PAYG withholding from interest, dividend and royalty payments paid to non-residents – annual report (PAYG annual report);
- paying withholding tax to the ATO, unless a withholding exemption or tax treaty relief applies.
The PAYG annual report must be lodged by 31 October each year. Taxpayers can lodge online or use a paper form.
The PAYG withholding reporting year is 1 July to 30 June regardless of any substituted accounting period. Taxpayers do not have to lodge this annual report if they have correctly reported interest or dividend payments to foreign residents in an annual investment income report (AIIR).
