Taxable Payments Reporting – Building and Construction Industry
From 1 July 2012, businesses in the building and construction industry need to report to the ATO total payments made to each contractor for building and construction services each year.
For each contractor, you need to report the following details each financial year: ABN, name, address, gross amount you paid for the financial year (this is the total paid including GST) and total GST included in the gross amount you paid.
You will need to report these payments to the ATO on the Taxable payments annual report due by 21st July 2013.
Who needs to report?
From 1 July 2012, you need to report if all of the following apply:
- you are a business that is primarily in the building and construction industry
- you make payments to contractors for building and construction services
- you have an Australian business number (ABN).
You are considered to be a business that is primarily in the building and construction industry if any of the following apply:
- in the current financial year, 50% or more of your business activity relates to building and construction services
- in the current financial year, 50% or more of your business income is derived from providing building and construction services
- in the financial year immediately before the current financial year, 50% or more of your business income was derived from providing building and construction services.
The aim of the system is to improve compliance with tax obligations by those contractors who are currently not doing the right thing. The information reported about payments made to contractors will be used for data matching to detect contractors who have not:
- lodged tax returns
- included all their income on tax returns that have been lodged.
If you are a current client of ours and are currently using a computer system for your bookkeeping please contact us for instructions on how to alter your system to ensure simple reporting procedures.
For a Microsoft Excel template for reporting taxable payments please click here
Click here for a fact sheet from the Australian Taxation Office
For more information from the Australian Taxation Office