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Business Tax Tip – TPAR – Taxable Payments Annual Report

images/Business Tax Tips.PNGIf you're a business that is primarily in the building and construction industry, you need to report payments you make to contractors, on the TPAR – Taxable Payments Annual Report, if both of the following apply:

  • you make payments to contractors for building and construction services
  • you have an Australian business number (ABN)

Contractors can be sole traders (individuals), companies, partnerships or trusts.

You need to report these payments to us on the Taxable payments annual report special form, and lodge by 28 August each year.

Activities and services that are considered to be building and construction are broad. Some examples include architectural work (including drafting and design), certification, decorating (including painting), engineering, landscaping and construction, project management and surveying.

Payments you need to report

Report only payments you make to contractors for building and constructions services.

Contractors can be sole traders (individuals), companies, partnerships or trusts.

If invoices you receive include both labour and materials, whether itemised or combined, you report the whole amount of the payment, unless the labour component is only incidental.

The definition of building and construction services is broad – it includes any of the activities listed below if they are performed on, or in relation to, any part of a building, structure, works, surface or sub-surface:

  • alteration
  • assembly
  • construction
  • demolition
  • design
  • destruction
  • dismantling
  • erection
  • excavation
  • finishing
  • improvement
  • installation
  • maintenance (excluding the maintenance, service or repairs of equipment and tools)
  • management of building and construction services
  • modification
  • organisation of building and construction services
  • removal
  • repair (excluding the service or repairs of equipment and tools)
  • site preparation

The ATO website tells us – (From Here)

You may need to lodge a Taxable payments annual report by 28 August each year if you are a:

  • business in the building and construction industry
  • government entity

The Taxable payments annual report tells us about payments you have made to contractors for providing services. Some government entities also need to report the grants they have paid and payments they make to certain other entities.

Contractors can include subcontractors, consultants and independent contractors. They can be operating as sole traders (individuals), companies, partnerships or trusts.

The details you need to report about each contractor are generally found on the invoice you should have received from them. This includes:

  • their Australian business number (ABN), where known
  • their name and address
  • gross amount you paid to them for the financial year (including any GST)

We use this information to identify contractors who haven't met their tax obligations.

Find out about:

How to lodge your Taxable payments annual report.

The annual report is due by 28 August each year.

Lodging online.

You can lodge online through:

  • ATO portals - if you have business software that can generate the electronic taxable payments annual report, you can lodge online using the Business, Tax Agent or BAS Agent portals. To lodge via the portals your software must meet the electronic reporting specifications. The specifications contain a full list of data elements. You can find a copy of the specifications at https://softwaredevelopers.ato.gov.au/TPARspecification
  • Standard Business Reporting (SBR) - if you have SBR enabled software that has the reporting functionality, you can lodge directly from the software. If you’re unsure, check with your software provider.

Lodging on paper.

If you are unable to lodge online, you can order the Taxable payments annual report form (NAT 74109) online or by phoning our publications ordering service, and mail us the completed form. You can't make copies of this form – you must use original forms the ATO printed. A sample of the paper form and instructions are available on the ATO website .

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Accounting Software Australia, MYOB, Quickbooks, accounts software, bookkeeping software
Accounting Software Australia, MYOB, Quickbooks, accounts software, bookkeeping software
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