• Taxable payments reporting – building and construction industry

    Do you run a business in the building and construction industry that pays contractors for building and construction services?

    If you do, you need to report the total payments you make to each contractor for building and construction services each year. You need to report these payments to us on the Taxable payments annual report.

    We will use the information you report about payments you made to contractors to detect contractors who have not:

    • lodged tax returns
    • included all their income on tax returns that have been lodged.

    To make is easier to complete the Taxable payments annual report you may need to check the way you record your contractor information.

    Who needs to report?

    You need to report if all of the following apply – you:

    • are a business that is in the building and construction industry
    • make payments to contractors for building and construction services
    • have an Australian business number (ABN).

    What do you need to report?

    You need to report the following information about each contractor:

    • their Australian business number (ABN), if known
    • their name
    • their address
    • the gross amount you paid them for the financial year (this is the total amount paid including GST)
    • the total GST included in the gross amount you paid.

    You can find this information in the invoices you received from your contractors.

    Attention

    A contractor can be a sole trader (individual), partnership, company or trust.

    End of attention

    Get it done

    If you keep your records on paper, you can download and print a blank worksheet to help you record the information you need to complete the report.

    For a copy of the worksheet, refer to Taxable payments reporting – worksheet

    It is for your records only – do not send the worksheet to us.

    End of get it done

    Payments you need to report

    You need to report the total payments you make to each contractor for building and construction services that are performed on, or in relation to, any part of a building, structure, works, surface or sub-surface.

    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 on our website at ato.gov.au/taxablepaymentsreporting. You will also find a list of examples of buildings, structures, works, surfaces or sub-surfaces, which includes housing, commercial and industrial buildings, footpaths, sports fields and tunnels.

    When your payment is for both labour and materials, you report the whole amount.

    Payments you do not report

    Do not report:

    • payments for materials only
    • any invoices that you have received but have not paid as at 30 June each year
    • payments which must be reported in a Pay as you go (PAYG) withholding payment summary annual report, such as payments to employees
    • payments for private and domestic projects – for example, payments you make for building or renovating your own home.

    When do you report?

    The Taxable payments annual report is due by 28 August each year.

    How do you lodge your report?

    You can lodge your Taxable payments annual report online or on paper.

    Online

    The easiest and most secure way to lodge your report is online.

    You can lodge your report online using the Business Portal or Standard Business Reporting (SBR).

    To lodge online you will need the following:

    • an ABN
    • an AUSkey – to protect your security and privacy when dealing with us online
    • accounting software that can generate the taxable payments annual report.
    Attention

    Do you have an AUSKey for your ABN?

    If you do not have an AUSkey for your ABN, you can register for one at auskey.abr.gov.auExternal Link

    End of attention

    Watch

    You can watch a short video (in English) about lodging your Taxable payments annual report online using the Business Portal at ato.gov.au/tpr

    Duration 03:39. A transcript (in English) is also available.

    End of watch

    On paper

    To lodge on paper you will need to complete and send the Taxable payments annual report (NAT 74109) to us. You must use the forms we have printed. You cannot print your own or use photocopies.

    Each form allows you to report up to nine contractors. If you paid more than nine contractors in the year, you will need to order additional forms.

    You can obtain taxable payments annual report forms from our online publications ordering service on ato.gov.au/onlineordering or by phoning us on 1300 720 092.

    Find out more

    A sample of the form is available on our website at ato.gov.au/taxablepaymentsreporting

    End of find out more

    Examples

    Example 1: Business in the building and construction industry paying a contractor for building and construction services

    Mohamed is a builder, and Mario is an electrician. Mohamed is in the building and construction industry, and Mario has been contracted to install the wiring which is a building and construction service. Mario is providing building and construction services to Mohamed’s business.

    Mario issues invoices to Mohamed for work completed, including amounts for the supply of materials. Mohamed already needs to keep records for tax purposes. He also needs to report the total of all the payments he makes to Mario throughout the year to the ATO on the Taxable payments annual report.

    End of example

     

    Example 2: Business not in the building and construction industry

    Tough Work Wear is a retail clothing business that engages a builder to extend their shop.

    Although Tough Work Wear is a business and has an ABN its core activity is retail. It is not a business in the building and construction industry.

    Tough Work Wear is not required to report payments it makes to the builder for building and construction services.

    End of example

     

    Example 3: Homeowners renovating their own home

    Yusef and Aalia are home owners, building their own home. They have engaged contractors themselves, to save money.

    Yusef and Aalia are not required to report the payments they make to the contractors as they are not carrying on a business in the building and construction industry.

    End of example

    More information

    • visit our website at
    • phone us
      • on 13 28 66 from Monday to Friday, 8.00am – 6.00pm (local time)
      • If you do not speak English well and need help from the ATO, phone the Translating and Interpreting Service (TIS) on 13 14 50
    • visit one of our shopfronts
    • speak to your registered tax agent or BAS agent.
      Last modified: 11 May 2015QC 43149