Attention: Building & Construction clients
As part of the ATOs aim to improve reporting compliance by contractors, businesses within the building & construction industry are now required to submit an annual report of all payments made to contractors for provision of building and construction services for each financial year. This Taxable Payments Annual Report can be lodged via letter or phone and includes details of each payees name, ABN, contact information, total gross amount paid, total GST, and total of any tax withheld where ABN was not quoted.
Payments to employees or parties under voluntary or labour-hire agreements are not required to be reported in the this report.
The information reported about payments made to contractors is used in the ATO’s data matching program to detect contractors who have not:
Lodged tax returns, or
Included all of their income on tax returns that have been lodged
These reports will mean that recordkeeping with respect to contractors will need to be extremely accurate to avoid misinformation being reported or information being omitted.
The ATO is currently following up outstanding lodgements and may issue non-lodgement penalties. This report was due for lodgement 21 July 2014, however a lodgement extension through to the 25th August 2014 has been granted where reports are prepared and lodged via your Tax Agent.
If you would like any assistance or additional information with respect to the record keeping requirements and preparation of these Reports please contact your Accountant or Client Manager and we are happy to assist.