If you're in the building and construction industry a new tax report is due this Sunday. Here's what you need to know.
Did you know that if you're in the building and construction industry, you now have to tell the ATO about payments you make to contractors for building and construction services?
It's called the Taxable Payments Annual Report (TPAR) and your first one is due by July 21 - this Sunday - so there's no time to lose.
The objective is to help check whether contractors are lodging tax returns and declaring all their income. All payments made to contractors for services must be reported, even where there is a materials component.
If you haven't yet determined whether your business is required to lodge a TPAR, the ATO's website outlines the requirements. But broadly if at least half of your business income or activity relates to building and construction and you make payments to contractors, you are caught in the net. If you're still not sure after reading that ATO document, it would be sensible to consult the ATO or your tax professional.
The Tax Practitioners Board is declaring taxable payments reporting to be within the scope of BAS agents (and as an interim measure has announced that it will not require BAS agents to register as tax agents before they can do such work), so your BAS agent will be able to handle your TPAR.
You'll find some software will help with this. Reckon, the company behind accounting products like Reckon One, got in touch with us to point out that Accounts Accounting and higher versions of its accounting software supports taxable payments reporting, but it's not as simple as just ticking a box - you need to identify the relevant contractors from the rest of your suppliers.
Things are much the same over at MYOB, where support is provided in LiveAccounts and "the latest version of AccountRight Live".
Tradies, you might also be interested to know that your tax returns have been under special scrutiny. Here is a Channel Ten News report about it: