Blog Layout

Taxable Payments Annual Report

Running a successful small business can be an extremely rewarding endeavour. However, it does come with its fair share of challenges. There are so many things that you need to be aware of and keep on top of to make sure the way your business functions is completely above board, as well as running smoothly.

Over the years, income tax reporting has been growing and changing, as the Government and Australian Taxation Office (ATO) wish to acquire more data. One reporting obligation that has really expanded in recent years is the Taxable Payments Annual Report system (TPAR)

TPAR is the third party reporting of particular tax related information to the ATO by suppliers of certain services. When It comes to small businesses, this usually means annually reporting the payments that are made to contractors when they are hired to help provide your services. The ATO is then able to use this information to cross check contractor’s annual income declarations.

Contractors themselves can also include subcontractors, consultants, and independent contractors. They are able to be operating as a sole trader, a company, partnership or trust.

In general, your Taxable Payments Annual Report is required to be made if these relevant services make up over 10% of your total projected turnover.

Your Taxable Payments Annual Report must be lodged by August 28th each year. If you fail to loge by this date, penalties can be applies.

To know if you are required to supply a Taxable Payments Annual Report you must:

- Have an Australian Business Number (ABN)
- Supplied a ‘relevant service’
- Made payments to one or more contractors to provide a relevant service

Examples of the types of relevant services:

- Building and construction services
- Cleaning services
- Courier services
- Road freight services
- IT services
- Security, investigation or surveillance services
- Mixed services

This being said, not all payments need to be reported

Some examples of things that do not need to be declared on your Taxable Payments Annual Report are:

- Payments for materials only
- Payments within consolidated groups
- Pay as you earn withholding payments
- Contractors who don’t proved an ABN
- Payments for private and domestic projects
- Incidental labour
- Invoices that are unpaid as od the 30th of June

Once you have established if you need to submit a Taxable Payments Annual Report, you have a variety of lodgement methods that you can chose from.

Different Taxable Payments Annual Report lodgement methods include:

- Lodging on paper (NAT 74109 form)
- Lodging online
- Lodging via business software

When lodging your Taxable Payments Annual Report, you will be required to supply certain details.

Payee details you need to report:

- ABN
- Business or individual names
- Address
- Total Amounts for the financial year including gross amount paid, total GST an d total tax withheld

Taxable Payments Annual Report are really important and are what help the ATO identify if a contractor has failed to include all of their income on their tax return, failed to lodge tax returns or activity statements, quoted an incorrect ABN on their invoices, or failed to register for GST when they’re required to. It’s a really important process in order to ensure that contractors are meeting their tax obligations.

If you require our help in preparing these TPARs for your business, please content Ascent Accountants on 08 6336 6200

< Older Post Newer Post >

Need help with your accounting?

Find Out What We Do

Why Public Liability Insurance is Essential for Your Business

March 14, 2025

If your business interacts with the public — whether through customers, suppliers, events, or onsite work — public liability insurance can protect you against claims for injury or property damage. This generally covers legal costs and compensation, and although it’s not legally required, being sued for negligence can be costly (and bad for your business rep), so it’s highly recommended.

The Challenges & Costs of Exiting a Co-Ownership Property

March 14, 2025

Co-owning a property can be a practical and financially beneficial arrangement, but when circumstances change, sometimes one party needs to jump ship. Whether due to financial strain, health issues, relocation, relationship breakdown, or differing property goals, it’s not uncommon for one co-owner to buy out the other. While this process may seem straightforward, there are several financial and legal considerations to consider.

Expenses to Consider When Selling a Property

March 14, 2025

Most people who sell a property — especially if it’s their first time doing so — are surprised (and frustrated) at how complicated it can be. Expenses (expected and unexpected) are a big part of that — and there are numerous costs throughout the process. These include real estate agent fees, legal expenses, marketing costs, and property preparation. Understanding and anticipating these expenses beforehand can help ensure a smooth and well-prepared road ahead.

Understanding Dividends — Franked & Unfranked

March 14, 2025

As an accounting firm, we understand the importance of structuring investments wisely. One key aspect that investors should carefully manage is their participation in Dividend Reinvestment Plans (DRPs). These plans can be a strategic way to grow an investment portfolio, but they also come with tax and record-keeping responsibilities can’t be overlooked.

Six things to consider when starting a business

February 13, 2025

Thinking of starting a business? Here’s what you need to know! Read our latest blog to learn six key things to consider before starting your business.

Understand tax implications for tax donations

February 13, 2025

Donating to charity is a great way to give back, but did you know not all donations are tax-deductible? To claim a deduction, your donation must be made to a Deductible Gift Recipient (DGR), and can’t receive anything in return. Read our latest blog to learn what you can claim and how to maximise your tax return.