The new financial year saw new reporting requirements for the construction industry.
The Government announced the introduction of taxable payment reporting in the last Federal Budget.
Businesses that operate in the building and construction industry should be aware of new reporting requirements that came into effect from 1 July 2012. A business is considered to be primarily operating in the building and construction industry when:
- In the current financial year, more than 50 per cent of business income is derived from providing building and construction services
- In the current financial year, 50 per cent or more of business activity relates to building and construction services
- In the financial year immediately before this one, more than 50 per cent of income was derived from providing building and construction services.
From 1 July 2012, businesses will be required to report the total payments they make to each contractor for building and construction services to the ATO.
All businesses will be required to keep receipts and any other paperwork used in conjunction with contractors.
The ATO may require this paperwork in the event of an audit. Businesses need to report provided that they make payments to contractors for building and construction services and they have an ABN.
The first taxable payments annual report is due 21 July 2013. For the 2012/13 financial year businesses that lodge their statement quarterly may lodge by 28 July 2013.
Our Newcastle office will be able to provide you with more information on how these changes will effect you and your business.