What is TPAR?
TPAR is short for Taxable Payment Annual Report. It is a report that certain businesses need to send to the ATO on a yearly basis, usually by the end of August. The report contains every payment that has been made to contractors or subcontractors within the financial year.
The ATO have become extremely strict with this in recent years, and are currently making phone calls to companies and BAS Agents to ensure compliance. The ATO are confirming payments of contractors with an invalid ABN or no ABN at all, meaning that bookkeepers now need to be even more accurate with the information that we provide to the ATO. If a contractor has no ABN or a cancelled ABN, then you need to withhold the increased tax amount until you have received it.
Affected industries include:
- Building & Construction
- Courier services
- Cleaning
- IT – Information Technology
- Road Freight
- Security, investigation, or surveillance
Why aren’t the ATO just using this information as intelligence? It’s because they are using the amounts that you report and pre-populating the contractor’s tax returns with this information. The reporting process isn’t too difficult, so we as bookkeepers can just use our accounting systems to produce a file and send it off, but first you must make sure the data is correct. The best way to do this is to keep it updated throughout the year.
What happens if you don’t report this by the 28th of August each year? Well, the ATO has the power to issue a fine of up to $1400 per year. To make sure this doesn’t happen, it is best to contact a BAS Agent or contact Client’s Needs Bookkeeping to make sure the data is correctly entered and lodged within the timeframe.
Client’s Needs Bookkeeping are a trusted bookkeeper who can take the heavy lifting out of your Taxable Payment Annual Report. Don’t fall foul of the ATO, get in touch now for a good service at a fair price.
