The ATO continues to expand the list of businesses who must report payments they make to contractors for services via the taxable payments annual report (TPAR).
Alongside businesses in the building and construction industry, any business that supplies cleaning or courier services are now also included in the taxable payment annual report system. You must report payments made to contractors each year providing your business has an Australian business number (ABN). The TPAR is due every year by 28 August.
When is a Taxable Payment Annual Report Required?
- You are running a business primarily in the building and construction industry.
- You are running a business providing cleaning or courier services (even if it is only part of the services you provide). You may need to lodge a taxable payments annual report if the payments you receive for courier or cleaning services account for at least 10 per cent of your total GST turnover.
ATO Defined Services
- Building and construction services cover a broad category, including architectural work, certification, engineering, and project management and surveying.
- Cleaning services include cleaning in interior and exterior spaces, carpet cleaning, swimming pool cleaning and gutter cleaning.
- Courier services include commercial activities where goods are collected or delivered on foot or via vehicles or drone. It will not be considered a courier service if delivery is the only option your customers have to receive their goods, you used a passenger transport service or a freight transport.
Payee Details to Include on Your TPAR:
- The ABN (where known)
- Business or individual’s name
- For the financial year, the total Gross amount paid (including GST plus any tax withheld), total GST paid to the contractor and total tax withheld where ABN was not given.
Payments Excluded from TPAR
- Payments for incidental labour
- PAYG withholding payments
- Payments within consolidated groups
- Payments for private and domestic services
- Payments for materials only
- Unpaid invoices as at 30 June each year
Need help with your taxable payments annual report or want to learn more about how the changes could affect your business? Get in touch with a business tax accountant from Taggart & Partners for a proactive business tax planning solution that will propel your business forward.
Updated 29th February 2020
*** This publication is for guidance only, and professional advice should be obtained before acting on any information contained herein. Neither the publishers nor the distributors can accept any responsibility for loss occasioned to any person as a result of action taken or refrained from in consequence of the contents of this publication. Publication date October 2018