Building and Construction Industry - What to Watch Out For

With the continual increase in ATO activity, it is important for businesses in the building and construction industry to comply with the reporting requirements of the Taxable Payments Annual Reports (TPAR) every year.

Taxable payments reporting for businesses in the building and construction industry aims to improve compliance with tax obligations by those contractors who are currently not doing the right thing. The ATO uses this information to data match contractors who have

• not lodged tax returns; or
• not included all of their income on tax returns that have been lodged;

Businesses that meet the following conditions must prepare and lodge a TPAR by 28^th August each year:

• businesses that are primarily in the building and construction industry (i.e. in the current or last financial year, 50% or more of the business income or business activity relates to building and construction services); and
• payments are made to contractors for building and construction services; and
• businesses that have an Australian business number (ABN);

The ATO is also targeting contractors who operate with a cancelled ABN or are not registered for GST but are charging GST on their invoices. ABN Lookup (http://abr.business.gov.au/) is a public view of the Australian Business Register and provides access to publicly available information supplied by businesses when they register for an ABN. By simply inputting the contractor’s ABN in the search section, details such as if the contractor is using a valid ABN or if the contractor is registered for GST will be displayed. In doing this, when engaging a new contractor, businesses can ensure that they are dealing with genuine contractors.

More information of the Taxable Payments Annual Reporting can be obtained from the following link:

https://www.ato.gov.au/Business/Building-and-construction/In-detail/Taxable-payments-reporting/Taxable-payments-reporting/?page=1