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Monday 18 June 2012

Reportable Payments System - Contractors

BUILDING & CONSTRUCTION INDUSTRY

From 1 July 2012 business in the building & construction industry will be required to report to the ATO, annually all payments to suppliers/subcontractors who provide building services.

Who has to report?
A business who has more than 50% of their activity or 50% of their income for the year or the prior year in the building & construction industry, including sole traders/contractors (known as ‘purchasers’). If they hire a subcontractor ‘supplier’ to provide building services the purchaser is required to report the subcontractor payments to the ATO.

EXAMPLES
  1. An electrical business provides goods & services for various electrical applications. A builder pays the business for the supply & installation of wiring in a commercial fit out that he is managing. As the provision of the installation service is a building & construction activity & more than incidental to the supply of goods, the builder will be required to report the payment it makes to the electrical business. 
  2. A paint store provides paint to painters as well as an in-house painting service. For a small additional service fee the store will tint the paint to the colour the painter instructs. As the provision of the tinting service is merely incidental to the supply of the paint, the painter will not be required to report the payment it makes to the paint store.
 Please talk to us regarding these CHANGES


ANGEL HAYES & ASSOCIATES PTY LTD
P | 0425 75 00 80                   W | www.angelhayes.com.au                E | info@angelhayes.com.au

1 comment:

  1. I found so many posts regarding reporting to ATO but I found your post very informative. Good work!

    ReplyDelete