Taxable Payments Annual Report Includes New Industries for 2020
The MB+M Compliance team brings you an update on the taxable payments annual report (TPAR). The TPAR reports to the ATO information about payments made to contractors for certain services. This year’s Taxable Payments Annual Report Includes New Industries for 2020 as explained below.
Is your business already covered by TPAR? Read below to see what has changed for 2020 and see if there are any affects for your business.
TPAR for the building and construction industry have been in place for some years. In recent years, there has been the addition to the system of cleaning services, courier services and some government entities.
This year, the ATO expanded taxable payments reporting 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
- Name of Contractor
- Address of Contractor
- 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 ATO requires the business to report these payments.
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. ATO treats road freight and courier services 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 are mandatory to report, 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 must submit a TPAR. Most accounting software programs include a means of preparing the TPAR from within the software, provided the business has entered all the required details about contractors paid throughout the year.
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 reporting is mandatory.
MB+M Compliance team can assist you in setting up the software for correct reporting of contractors for TPAR, and review the report before submitting to the ATO.
If you are unsure and have questions, or need some help. Contact MB+M on 03 5821 9177 and speak with one of our experienced accountants.
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