If your ATO (Australian Taxation office) account is showing as default or overdue balance even though you paying on time, there are several common reason  this happens.

• Payment not yet allocated by ATO
• The payment has not been processed yet by ATO, can take 1-3 days to update.
• ATO has not allocated to the correct account,
• When you made the payment, put the wrong refence number

Even one incorrect digit in the PRN can cause the payment sit as UN-allocated. It is very important put the correct account number for Activity statements and Income tax Account seprately.

• Note, ATO will add interest rate (GIC) general interest charge currently at 7-8% for outstanding overdue payment. Always, recommended to make payment plant to avoid this scenario.

Other reason for showing as default is new lodgement :

• New lodgement create a new balance.

When there is new lodgement such as Activity statement or GST/BAS statement, it will create new account balance. The ATO system calculate the new account balance. Need to make exact amount as per the new BAS statement before due date or cancel the old payment plan and create a new payment plan for the whole outstanding balance. Do this before the new lodgement payment due date.

Otherwise, the existing payment plans will automatically default. And show as overdue and ATO will charge interest on the whole outstanding account.

In most cases, a “default” status is caused by technical issues, interest charges, a new lodgement, payment delay or paid after payment plans due date or paid different amount than the payment plans or paid to the wrong account, not just because you failed to pay.

At Fair Tax Accountant, we pride ourselves on offering affordable taxation and Bookkeeping services with exceptional customer care. Our locally-based, registered small business accountant have years of experience in personal and business tax returns. We are committed to ensuring that you receive the maximum refund or pay the least tax possible—while strictly adhering to ATO regulations.