ATO late lodgement penalty: up to $364 per 28 days, capped at $1,820 per document · interest 11.43% p.a. compounding daily · See how to remit them →
What is the GIC and what's the current rate?
The current GIC rate is 11.43% p.a. for the July-September 2026 quarter. The rate is set every quarter based on a formula tied to bank bill rates, so it moves gradually over time rather than staying fixed.
Rates checked 30 July 2026 - GIC 11.43% p.a. for the July-September 2026 quarter.
How is GIC calculated?
GIC is calculated by applying the daily rate to the outstanding balance and compounding it every day, so interest is charged on interest already added. For a $20,000 tax debt at 11.43% p.a., the daily rate works out to roughly 0.0313%, or about $6.26 in interest on the first day alone.
Because it compounds daily, that $20,000 debt left completely unpaid for a year would grow by more than $2,200 in GIC alone, even before any new tax liabilities are added. Left for several years, the compounding effect becomes significant, which is exactly why old, ignored debts often look far larger than the original tax bill.
Is GIC tax deductible?
Can GIC be remitted?
Yes, GIC can be remitted in full or in part, though it's a decision the ATO makes on the facts of your situation rather than something owed automatically. Grounds the ATO may consider include serious illness, natural disasters, an isolated administrative error, or genuine financial hardship combined with a good compliance history.
How to request GIC remission
Get your lodgements up to date.
The ATO is far more likely to consider remission once all outstanding returns and BAS have actually been lodged.
Identify the periods and amount of GIC involved.
A tax agent can pull a full statement of account showing exactly how much interest applies and when it was charged.
Set out the circumstances clearly.
Explain what caused the delay in payment, with any supporting evidence such as medical certificates or hardship documentation.
Submit the remission request.
This is usually lodged through ATO online services or directly by your registered tax agent on your behalf.
GIC vs SIC vs FTL penalty - what's the difference?
GIC, SIC and the FTL penalty are three separate charges that often get confused because they can all apply to the same overdue tax situation. The table below sets out what each one is actually for.
| Charge | What it's for | How it's calculated | Deductible? |
|---|---|---|---|
| General interest charge (GIC) | Interest on unpaid or late-paid tax debt | Daily compounding on the outstanding balance | No, from 1 July 2025 |
| Shortfall interest charge (SIC) | Interest on a tax shortfall from an amended assessment | Daily compounding, usually a lower rate than GIC | No, from 1 July 2025 |
| Failure to lodge (FTL) penalty | Penalty for lodging a return or statement late | Penalty units per 28 days overdue, capped at 5 units | No |
For a full breakdown of how the FTL penalty itself is worked out and remitted, see our guide to the ATO failure to lodge penalty.
How do you stop GIC growing?
You stop GIC growing by paying the debt, setting up a payment plan, or successfully applying for remission - waiting doesn't pause it. Even a partial payment reduces the balance GIC is calculated on each day, and a formal payment plan at least brings some structure and predictability to the debt, even though GIC generally still accrues while it's in place. Our guide to ATO payment plans explains how that works in practice.
Frequently asked questions
What is the GIC rate right now?
Does GIC apply on payment plans?
How far back can interest be remitted?
Why did my ATO debt grow while I was paying?
General information only - not personal tax, financial or legal advice. Consider your own circumstances or speak to a registered tax agent. Remission of penalties or interest and payment plans are decisions of the ATO and outcomes can't be guaranteed.