As announced by the ATO last year, businesses in the building and construction industry will be required to report to the ATO the total payments they have made to each contractor for all building and construction services provided, which is to start this financial year.
This reporting is only required for payments that have been made for labour where it is the greater part of an invoice. Payments that are for materials only or where labour is incidental in the overall invoice, do not need to be reported.
Any information you provide to the ATO will be used by the ATO for data matching to detect contractors who have not lodged tax returns or may not have included all income in their lodged returns.
Information that you are required to provide to the ATO includes:
- Total paid for the year including GST; and
- GST included in the total paid.
All of this information can be found on the invoice the contractor provides to you.
THE FIRST ANNUAL REPORT IS DUE JULY 21 2013 FOR ALL PAYMENTS MADE DURING THE 2012-13 FINANCIAL YEAR. IN THIS FIRST YEAR, BUSINESSES THAT LODGE THEIR BAS QUARTERLY MAY LODGE BY JULY 28 2013.
We encourage you to check your records to ensure that your business complies with this new reporting requirement.
Follow this link to view the new Taxable Payments Annual Report you will now be required to lodge