If your business engages contractors and suppliers, you will need to keep all records relating to payments made to them in order to claim deductions.
If your business pays contractors (including cash payments) to provide certain services on your behalf, you may also need to complete a Taxable payments annual report (TPAR) reporting these payments to us. To find out about which businesses need to complete a TPAR and when reports are due, refer to our information on Taxable payments annual report.
Examples of the type of records you need to keep include:
- contracts or written agreements
- invoices issued and received
- amounts paid
- payment summaries or income statements issued
- superannuation payments (if applicable)
- voluntary requests made by a contractor for you to withhold tax amounts from payments
- tax you withheld from payments when a supplier doesn't quote their ABN.
How long you need to keep contractor and supplier records
You need to keep these records for five years starting from when you prepared or obtained the records, or completed the transactions or acts those records relate to, whichever is later.
You should keep records long enough to cover the period of review (also known as the amendment period) for an assessment that uses information from the record.
Find out about:
- Records connected to an assessment that's amended
- Employment and payroll records businesses need to keep
- Index – Record keeping for business
- Difference between employees and contractors
- Payments under a voluntary agreement
- Statement by a supplier not quoting an ABN
- Super for employers