Businesses in the building and construction industry have been required since 1st July 2012 to record the total payments they make to each contractor for building and construction services, so that it can be reported on an annual basis. The first Taxable Payment Report is due on 21st July 2013 (if your company lodges BAS quarterly you will have an extra week in 2013, with an extended deadline of 28th July).
Who needs to report?
You are obliged to report if:
- you are a business that operates primarily in the building and construction industry
- you make payments to contractors for building and construction services
- you have an ABN
How does the ATO determine whether you meet these criteria?
If 50% of more of your business income in the financial year OR prior financial year was derived from providing building and construction services, OR 50% or more of your ‘business activity’ in the financial year relates to building and construction services, then you are deemed to operate ‘primarily’ in the the building and construction industry.
What do you need to report?
You will need to report each relevant contractor’s:
- ABN (if known)
- Gross amount paid for the financial year (including GST)
- The total GST that was included in that gross amount
Need more info?
The ATO web site clarifies a number of critical details that impact whether or not you are caught in the net of this reporting requirement, and defines occupations and work activities that qualify as building and construction services. You can read all the details here.