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ATO Contractor Payment Reporting in Construction

  • Wednesday, June 19, 2013

As you may be aware the ATO have introduced legislation which requires the reporting of contractor payments in the construction industry. The entity using contractors is required to report details of contractor payments to the ATO by the 28th July 2013. This is extended to the 25th August 2013 if the report is lodged by a tax agent.

You may be classified as being in the construction industry under the ATO’s definition without realising it.

The ATO define an entity as being in the construction industry if:

  • 50% of the entities business activity related to building and construction services, or
  • 50% of the entities business income is derived from providing building and construction services.

The ATO state that construction services are broad and can include:-

  • alteration
  • demolition
  • design
  • erection
  • excavation
  • installation
  • maintenance

Effectively this means if 50% of your income is from work in the areas listed above then you may be defined as being in the construction industry.

The ATO’s definition of businesses providing building and construction services may include architects, electricians, painters, plumbers, concreters, plasterers, earth movers etc. It is not restricted to builders.

We can assist you to determine whether you are required to lodge a payment summary or if you would like us to prepare or lodge the payment summaries on your behalf.

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