As we have mentioned in a previous article, businesses that provide cleaning or courier services will now need to lodge a Taxable Payments Annual Report (TPAR).
What is a TPAR and does it affect me?
A TPAR informs the tax office about any payments that have been made to contractors for providing services.
If the total payments are 10% or more of your GST turnover (or if you are primarily in the building and construction industry) – you must lodge a TPAR.
Even if you are not registered for GST, you must still check if you need to lodge a TPAR. All businesses have a GST turnover, regardless of whether or not they are registered for GST.
If you provide cleaning or courier services and do not believe that you need to lodge a TPAR, because you have not made any payments to contractors, you will still need to lodge a nil report with the ATO.
Other businesses, beside cleaning and courier services, that must lodge a TPAR include:
- Building and construction services
- Road freight services
- Information technology (IT) services
- Security, investigation or surveillance services
- Mixed services (if the business provides multiple of the services outlined above).
When is my TPAR due?
Your TPAR is due by 28 August 2019, and this must entail all payments made to contractors between 1 July 2018 and 30 June 2019.
Businesses can lodge their report either online or with a paper form.
The information that must be included is:
- The ABN of the contractor (if possible)
- The name of the contractor (either their personal name or business name)
- The address of the contractor
- The total figures for the financial year, including:
- Gross amount paid to them (incl. GST)
- GST paid to them
- Tax withheld if an ABN was not quoted.
Failure to lodge in time will often result in a penalty, so if you require any assistance, now is the best time to contact a small business tax professional.