Question

[Magic]

I am effectively only being paid for 5 months out of this financial year due to maternity leave? The tax I pay is huge, and I want the withholding tax over these 5 months to be reduced to reflect the change in per annum income. That way I get the money now instead of waiting for the the tax refund this time next year.

Do I have to complete a variation form with the ATO, before my payroll office will reduce the tax withheld?

[SuzL]

Hi Sheree

I was thinking about the same thing! I think you need to fill out the form with the ATO first. I just went onto the ATO website and typed in 'tax withheld' in the search field and it comes up with a 'withholding tax declaration' section. Hope this helps!

[Kirsty77]

Yep thats what I was going to say. Just ask your employer for a tax dec form and refill it out and they should send it to their/your payroll dept and they'll know what to do with it.HTH's

[Astrid]

Ok, once you are employed there are a number of forms that can be used to change your tax rate, (please note that the Tax File Number Declaration should only be completed once with each employer), the main ones are:

Withholding declaration
This is really only for increasing the tax paid, declaring HECS etc. Claim FTB through a reduction in your tax

Downwards Variation - quote from ATO
2007 PAYG income tax withholding variation (ITWV) application

Approval to reduce the amount you are required to withhold from a payment can be provided only by the Tax Office. This usually happens only in special circumstances where the payee can demonstrate that their final tax liability for all income in the year does not justify the standard withholding rate.
If a downwards variation is approved, we will send an approval letter to the payee and a variation notice to you, outlining the new rate or reduced amount to be withheld. Both the notice and the letter will clearly specify the expiry date of the notice.

Basically they make it easy to pay more tax, but harder to pay less. As usual see your accountant, call the ATO etc if you have any queries.