You may need to lodge a Taxable payments annual report (TPAR) by 28 August if your business pays contractors to provide the following services:
- Building and Construction
This includes plumbing, architectural, electrical, plastering, carpentry, engineering and a wide range of other construction/building activities.
This includes interior and exterior cleaning of structures, vehicles, machinery and cleaning for events.
- Courier Services or Road Freight Services
This includes delivery of items or goods (such as parcels, packages, letters and food) by motor vehicle, bicycle or on foot,
the transportation of freight by road, truck hire with driver, and road vehicle towing services
- Information Technology
This includes writing, modifying, testing or supporting software to meet a client’s needs, whether on site or remotely through the internet
- Security, Investigation and Surveillance
This includes patrolling and guarding people, premises or property, watching or observing an area and monitoring security systems.
and investigation specifically related to security and surveillance, not just information gathering.
Contractors can include subcontractors, consultants and independent contractors. They can be operating as sole traders (individuals), companies, partnerships or trusts.
Doing your TPAR involves three steps:
Prepare – work out if you need to report. Due to COVID-19, you may have contracted out more services in the past year, for example cleaning or delivery, so you may need to lodge a TPAR for the first time.
Record – check you’re keeping the right records, such as total payments you make to each contractor for services. This includes cash payments.
Report – lodge your TPAR online by 28 August. Lodging on time allows ATO to prefill the information in sole traders’ tax returns.
The information collected in the TPAR will help ATO identify contractors who are not meeting their tax obligations. The taxable payments reporting system aims to create a level playing field – to prevent dishonest operators from gaining an unfair advantage over the majority.
Remember, registered tax agents and BAS agents can help you with your tax.
If you need help, feel free to contact us.
Yan (Jenny) Qi CA
Founder of Progress CA Pty Ltd
Tel. no. 0403 050 779