Managing overpayments

If you get a Parental Leave Pay overpayment, you'll have to repay the money.

Overpayment

You may get an overpayment of Parental Leave Pay if your circumstances changed. This could happen if you return to work before the end of your Paid Parental Leave period. It may also happen if you were no longer entitled to get the payments but didn't tell us.

When we know you have an overpayment, we’ll send you an Account Payable notice. This will advise you of the amount of overpayment. You’ll have to repay that amount using one of the repayment options included in the notice. You can contact us to discuss repayment options or your review and appeal rights.

You’ll have to repay the gross amount. This includes both:

  • the net amount of Parental Leave Pay you got from your employer
  • the Pay As You Go (PAYG) withholdings your employer paid to the Australian Taxation Office (ATO) for Parental Leave Pay.

Getting a refund of PAYG withholdings when an overpayment occurs

From your employer or from us

If we paid you directly you can request a refund of the PAYG withholding amount from us. You can do this in the same financial year in which the overpayment occurred. We can recover this amount from the ATO. We'll reduce your gross debt by this amount.

If you were getting the payment from your employer, we’ll recover the gross amount of the overpayment from you. You can then request a refund of the PAYG withholding amount from your employer. This is if it’s still the same financial year in which the overpayment occurred. Your employer will refund this amount to you.

From the ATO

If the overpayment occurred in a previous financial year, you'll need to recover the PAYG withholding amount from the ATO. You'll have to do this if you got the overpayment from us or your employer.

If the ATO hasn't completed your income assessment, you can get an offset of the overpaid PAYG withholding amount. This is in the calculation of your tax return.

If the ATO completed your income assessment, you should apply in writing to them for an amended income assessment. You should provide them with a copy of the Account Payable notice you got from us.

If an overpayment spans 2 financial years, each of the 2 processes described above will apply. This is to the portion of the debt that occurred in the relevant financial year.

Payment summaries

Parental Leave Pay is a taxable payment so you’ll get a payment summary. You'll get this either from us or from your employer.

If you got an overpayment, you’ll get an amended payment summary. We’ll issue it if we provided Parental Leave Pay directly to you. Your employer will issue it if they were providing Parental Leave Pay.

If your employer hasn’t issued your payment summary for the year the overpayment occurred, they must adjust their payroll record. This is so they don’t report the overpaid amount as income on your payment summary.

If your employer already issued your payment summary for the year the overpayment occurred, they need to give you either:

  • an amended payment summary
  • a letter containing relevant information about the overpayment for you to provide to the ATO.

They’ll do this within 28 days of when they became aware of the overpayment.

The arrangements for the amendment of payment summaries are similar to those that apply to overpaid salary or wages.

Read more about PAYG on the ATO website or speak with your employer.

Page last updated: 14 September 2020