Construction and building industry: Reporting Your Taxable Payments
Are you operating a business in the construction and building industry? Adelaide accountant Tony Vroulis highlights the importance of reporting your contractor payments to the ATO as required.
It has recently been publicised that the Australian Tax Office (ATO) is sending out reminder letters regarding the Taxable Payments Annual Report that businesses in the building and construction industry are required to submit.
By 28 August every year, businesses in the construction and building industry need to report how much they've paid out to contractors for services.
We want to take this opportunity to remind all our valued clients, and business owners generally, of how important it is to report your taxable payments every year.
It doesn't matter where on your tax return you claim contractor expenses or how you label them. They still need to be reported in a separate form.
Details that need to be reported for each contractor include:
· Gross Amount you paid for the financial year inclusive of GST
· Total GST included in the gross amount you have paid
These reports help the ATO track down contractors who haven't lodged tax returns or who haven't reported all of their earnings.
What if you have trouble collecting records of all that you've paid out? This seems to be the most common issue.
Our clients who don't seem to have trouble with reporting are the ones who use software like Xero or MYOB to organise their information.
Xero has a great instructional video on setting up and running a taxable payments report.
It usually is a lot harder to accurately report your payments if you have to scramble at the last minute to collect them all!
If you're in the building and construction industry and need help with reporting taxable payments, contact our team here at Wallace Vroulis Bond.
We'll help you set up a reliable method for organising your records and reporting the data on time.