• Do you work as a contractor in the building and construction industry?

    If you are a contractor in the building and construction industry you need to know about taxable payments reporting.

    Businesses in the building and construction industry have to report to us each year the total amount they paid you for building and construction services. They need to report these payments to us on the Taxable payments annual report.

    The information reported to us will be used to identify those contractors who have not included all their income on their tax return, or not lodged tax returns. It is important to include all of your income on your tax return to avoid any penalties.

    If you have not met your tax obligations and you choose to do nothing, you could be selected for a review or audit and may face penalties.

    What are building and construction services?

    The definition of building and construction services is broad and covers a wide range of occupations and activities. It includes services such as bricklaying, plumbing, fencing and it also includes architectural work (including drafting and design), decorating (including painting), engineering and landscaping construction.

    Examples of occupations and activities (in English) are available at our website at ato.gov.au/taxablepaymentsreporting

    Example

    Ming is an electrician, and has been contracted by Mohamed, who has a business in the building and construction industry. Ming has been contracted to install wiring in a building, which is a building and construction service.

    Ming issues invoices to Mohamed for the work completed. Ming keeps records of all the income he has received and reports this on his tax return.

    Mohamed will lodge a Taxable payments annual report with us and it will be used to check that Ming has lodged a tax return and included all the income he received from Mohamed and other businesses on his tax return.

    End of example
    Attention

    If you are a contractor in the building and construction industry and have met your tax obligations, you do not need to do anything.

    End of attention
      Last modified: 19 Nov 2014QC 43150