Taxable payments annual report
Some businesses and government entities need to report each year the total payments they make for services on the Taxable payments annual report. In addition, some government entities also need to report grants paid.
These payments need to be reported to us on the Taxable payments annual report by 28 August each year.
Building and construction:
Businesses in the building and construction industry need to report the total payments they make to each contractor for building and construction services each year.
Government:
Government entities at the federal, state and local levels need to report from 1 July 2017, the total payments they make wholly or partly to businesses for providing services. Some government entities will also need to report grants paid to people or organisations that have an ABN.
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.
Details you need to report
The details you need to report for each contractor includes:
- ABN (where known)
- name
- address
- gross amount you paid for the financial year (this is the total amount paid including GST)
- total GST included in the gross amount you paid.
You are required to report the payments you make to contractors in the financial year in which the payments are actually made (cash basis).
The details you need to report are generally contained in the invoices you receive from your contractors.
When you receive an invoice, check the ABN on the invoice matches the ABN on your record for that contractor. Ensure you create a new contractor record if necessary. Where a contractor’s ABN changed during the year, you will need to include the two payee records in your annual report.
You can check your contractors’ details including ABN, name and GST registration to confirm they are correct by using ABN LookupExternal Link on the ABR website or ATO app.
For more information, please contact our consultant on 02 9954 3843.