The clock is ticking…

Have you made payments to contractors during the 2022 financial year? You may need to lodge a Taxable Payments Annual Report (TPAR) and the due date is fast approaching.
 
Businesses from specific industries who make payments to contractors, subcontractors, consultants and independent contractors may need to report these payments through the Australian Taxation Offices (ATO) Taxable Payments Reporting System (TPRS).
 
The TPRS captures payments made to contractors for services in the following industries:
  • Building and Construction
  • Courier
  • Cleaning
  • Information Technology
  • Road Freight, and
  • Security, Investigation or Surveillance.

If 10% or more of your business income for the financial year is for a service relevant to the above industries and you made payments to contractors for a relevant service during the year, then you must lodge a TPAR.

The due date for TPAR lodgement is 28th August each year.

Contractor details reported in the TPAR include the contractors ABN, name or business name, address, gross payments including GST and any tax withheld, the total GST paid to the contractor and total tax withheld where an ABN was not quoted.

The ATO collects this information about contractor payments to assist in identifying contractors who do not meet their tax obligations and to assist them in correctly reporting their income. As well as making sure businesses aren’t disadvantaged by competitors who do not declare all their income.

Do you have outstanding TPAR lodgements? The ATO has indicated they will be applying failure to lodge penalties to those businesses who have not lodged their 2021 or earlier year TPARs, and who have been sent three non-lodgement letters and have not responded to the ATO’s phone calls regarding their overdue TPAR’s.

TPAR’s can be lodged through SBR-enabled software, such as Xero, through online services for business, paper form or through your Tax agent.
 
If you have any questions regarding your TPAR lodgement, please contact our office.
 
 

Author

By Emma Russoniello