If you operate a business in the cleaning, courier, road freight, IT, or security/investigation industries, there are now additional reporting obligations to the ATO. This is in the form of a taxable payments annual report (TPAR) which deals specifically with contractors that you have paid.
What is the Taxable Payment Reporting System (TPRS)?
The taxable payment reporting system (TPRS) is an ATO initiative which aims to increase the tax compliance of certain industries that are vulnerable to the ‘black economy’.
As a part of the TPRS, businesses in certain industries are required to report payments they make to contractors for services. These payments are reported to the ATO annually in the form of a TPAR. With this information, ATO can check and ensure that the correct income is declared by those contractors on their tax returns.
New industries included in the Taxable Payments Reporting System
The TPRS was first introduced to the construction and building industry in 2012, and has now been extended to include the following industries:
- Cleaning
- Courier
- Road freight
- Information technology (IT)
- Security, investigation and surveillance
| INDUSTRIES | REPORTING START DATE | FIRST REPORTING PERIOD |
| Building & Construction | 1 July 2012 | 1 July 2012 – 30 June 2013 |
| Cleaning Services | 1 July 2018 | 1 July 2018 – 30 June 2019 |
| Courier Services | 1 July 2018 | 1 July 2018 – 30 June 2019 |
| Road Freight Services | 1 July 2019 | 1 July 2019 – 30 June 2020 |
| Information Technology (IT) Services | 1 July 2019 | 1 July 2019 – 30 June 2020 |
| Security, Investigation or Surveillance Services | 1 July 2019 | 1 July 2019 – 30 June 2020 |
Taxable Payments Annual Report (TPAR) Due dates
For businesses in the cleaning and courier industries, the very first taxable payments annual report (TPAR) is due by 28 August 2019, and covers contractor payments from 1 July 2018 until 30 June 2019.
For businesses in the road freight, IT, and security investigation and surveillance industries, the very first TPAR is due by 28 August 2020, and covers contractor payments from 1 July 2019 until 30 June 2020.
For the latest reporting period of 1 July 2018 – 30 June 2019, the due dates are as follows:
| INDUSTRIES | REPORTING START DATE | FIRST REPORTING PERIOD |
| Building & Construction | 1 July 2018 – 30 June 2019 | 28 August 2019 |
| Cleaning Services | 1 July 2018 – 30 June 2019 | 28 August 2019 |
| Courier Services | 1 July 2018 – 30 June 2019 | 28 August 2019 |
| Road Freight Services | Reporting begins 1 July 2019 | 28 August 2020 |
| Information Technology (IT) Services | Reporting begins 1 July 2019 | 28 August 2020 |
| Security, Investigation or Surveillance Services | Reporting begins 1 July 2019 | 28 August 2020 |
How the taxable payments reporting system affects your business
If your business operates in these industries, you will need to prepare the annual taxable annual payments report (TPAR) to report your contractor payments. This is a good opportunity to revisit the current accounting software or systems that you have in place, to make sure that the relevant information is captured.
When lodging a TPAR, the following details are required:
- Contractor’s name or business name
- Contractor’s ABN
- Contractor’s address
- The gross amount paid for services in the last year, including GST and tax withheld
Are there exceptions to the taxable payments reporting system?
There are some instances where businesses won’t be required to lodge a TPAR. This depends on how much income a business receives from the industries targeted by the TPRS.
Businesses that do not pay contractors will not have to complete a TPAR. But, a ‘Not Required to Lodge’ form will still need to be submitted to the ATO.
Need Help with the TPRS?
For more information on the TPRS or for help lodging this report, speak to our friendly team.
