Does ATO payment (which is already paid for the PAYG) is taxable income?

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Are you lodging your BAS and PAYGW in the GST center of QuickBooks Online (QBO)? If yes, the PAYGW amount should be included in your BAS amount. Furthermore, the process in QBO is we lodge the BAS in the GST center and then record payment for the BAS period. Once the payment is downloaded in the Transactions tab, we match the payment and allocate them to ATO clearing account.

To lodge the BAS in QBO:

1. Click on the GST tab, locate the BAS period to lodge.
2. Click on Prepare BAS.
3. Check the figures shown.
4. Click on Next.
5. If you've enabled PAYG Withholding in QBO, you'll see total salaries paid and total tax withheld amount. 
6. Click on Next.
7. Check other taxes enabled.
8. Review the BAS and click on Mark as lodged to close the tax period.

After you lodge the BAS the system automatically creates a journal to your ATO clearing account.

To record payment:

1. Click on the GST tab and go to To do tab.
2. Locate the BAS period lodged and click on Record Payment.
3. Enter amount paid and choose the Account the payment was used.
4. Select a Date and enter a memo.
5. Click on Save.

To match the GST payment recorded:

1. Click on the Transactions tab.
2. Select the bank account where the BAS payment is downloaded.
3. Select the GST payment downloaded.
4. The bank feeds usually recognize the match if the date and amount are the same and correct.
5. Click on the Match option. If none shows, click on Find match option.

Check these links to learn more about lodging BAS and recording payment in QBO:  

• Lodge your BAS or IAS in QuickBooks Online
• Record a GST payment in QuickBooks Online

Drop by again in the Community if you have other questions about QBO.