Annual reporting to the ATO of contractor payments

The taxable payments reporting system (TPRS) requires businesses to report to the ATO all payments made to contractors during an income year. This additional reporting is in the form of an annual report that is used by the ATO to cross check that contracting income is being correctly declared by contractors. The annual report is to be lodged with the ATO by 28 August each year and penalties may apply for not lodging an annual report by the due date.

At present the TPRS only applies to businesses in the following industries:

  • building and construction;
  • cleaning; and
  • couriers.

However, the 2018 Federal Budget included an announcement that from 1 July 2019 the TPRS would also apply to the following industries:

  • security providers and investigation services;
  • road freight transport; and
  • computer system design and related services.

For many businesses it will be quite clear that they are part of an industry to which the TPRS applies. However, for some businesses, particularly those with mixed supplies, it will not be clear whether they are required to report to the ATO under the TPRS.

We can assist if there is any doubt as to whether a particular business is included in one of the above industries.

UPDATE: The Act extending the TPRS to industries including security providers and investigation services, road freight transport, and computer design and related services received royal assent on 29 November 2018 and is now in effect.

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