Are you paying contractors? You may need to complete a TPAR to the ATO

The taxable payments annual report (TPAR) reports to the ATO information about payments made to contractors for certain services.

TPAR for the building and construction industry has been in place for some years. In recent years, cleaning services, courier services and some government entities have been added to the system.

This year, taxable payments reporting was expanded to include three new industries: road freight services, information technology services, and investigation or surveillance services.

Contractors include subcontractors, consultants and any other independent contractor who is not an employee.

Essential Information Included in the TPAR

  • Contractor ABN
  • Contractor name
  • Contractor address
  • Total for invoices relating to services only or a combination of services and materials
  • Total GST included
  • Business to business transactions only
  • TPAR is based on invoices paid from 1 July to 30 June (do not include unpaid invoices)
  • If the business provides mixed services, then if payments to contractors total 10% or more of GST turnover in any of the required industries the business is required to report.

Road Freight Services

Road freight includes transportation of goods by road, renting of trucks with drivers, vehicle towing, furniture removals, log haulage and truck hire (with driver) services.

Note that if the business provides services including road freight and courier services and if the total of both services equals 10% or more of GST turnover, the business must submit a TPAR. Road freight and courier services are treated as one grouping for TPAR.

Information Technology Services

Information technology (IT) services includes a large range within this industry, including software development, computer facilities management, designing computer or network systems, programming, installation software support and more.

Security, Investigation or Surveillance Services

There is also a wide range of services within the security industry that must be reported, including patrolling, protecting, guarding, investigation, surveillance, crowd control, alarm monitoring and armoured car services.

First Report This Year

This is the first year that businesses in these newly included industries are required to submit a TPAR. Most accounting software programs include a means of preparing the TPAR from within the software, once all the required details about contractors paid throughout the year have been entered.

The first report for the new industries is due by 28 August, the same due date for existing industries already required to submit a TPAR.

Unsure if You Should Complete a TPAR?

If your business offers road freight, IT or security services, either as the main type of income or as part of your business mix, talk to us about the contractors you pay.

Check the ATO taxable payments annual report webpage for full details of new and existing industries and all the services that must be reported.

We can assist in setting up your software for correct reporting of contractors for TPAR and review the report before submitting to the ATO.

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