Businesses in the building and construction industry must now report the total payments they make to each contractor for building and construction services each year. This change came into effect 1 July 2012. These payments are to be reported to the ATO as part of the Taxable payments annual report.

Who Needs To Report

• Businesses in the building and construction industry will need to provide the report if all of the following apply to them:
• The business is primarily in the building and construction industry
• Payments are made to contractors for building and construction services
• The business has an Australian business number (ABN).

A business is considered to be primarily in the building and construction industry if any of the following apply:

• In the current financial year, 50% or more of the business income is derived from providing building and construction services
• In the current financial year, 50% or more of the business activity relates to building and construction services
• In the financial year immediately before the current financial year, 50% or more of the business income was derived from providing building and construction services.

Details To Report
For each contractor the following details will need to be reported each financial year:

• ABN (if known)
• Name
• Address
• Gross amount paid for the financial year. This is the total amount paid inclusive of GST.
• Total GST included in the gross amount paid.

When To Report

The first Taxable payments annual report is due 21 July 2013 for payments made in the 2012-13 financial year. In this first year, if the activity statement is lodged quarterly, it can be lodged by 28 July 2013.