You can continue to use the Fund Income Tax Payment event > interest field if it is related to interest charges (non-deductible) or intereste received from ATO (assessable).
Issue
If you need to override ATO interest charges to be deductible or interest received to be non assessable, you can no longer use the Fund Income Tax Payment event to record that.
Reason
The ATO changed the rules to make interest incurred after 30 June 2025 non-deductible and non-assessable (for refund of GIC).
Class changed the default classification of Interest Charges to be non-deductible.
ATO Interest Received remains assessable to process Interest Received from early or overpayment of tax.
Resolution
If processing an ATO interest transaction and you need to override the default tax treatment which is (non-deductible or assessable), you should use manual transactions posted to separate income and expense accounts instead of using the Fund Income Tax Payment event. Follow the steps below for:
ATO Interest Charges:
Navigate to Fund Level > Transactions > Fund expenses > Fund general expense
This should be used if processing ATO Interest Charges incurred prior to 30 June 2025 which were deductible.
- Select Expense Type as General Interest Charge
- Select override for Tax deductible and choose Yes.
ATO Interest Income:
Navigate to Business Level > Settings > Fund income
This should be used if processing remmission or refund of GIC from 1 July 2025 when it should be non-assessable.
- Select Classification Type as Fund Income.
- Select Category Type as Interest.
- Click on Add New Income Expense Type button to set up a new interest income type that is non-assessable.