Businesses that pay contractors in specific sectors—such as building and construction, cleaning, courier and road freight, information technology (IT), or security, investigation, and surveillance—are reminded that the deadline to lodge the Taxable Payments Annual Report (TPAR) is fast approaching.
Government entities that provide grants to individuals or organizations with an Australian Business Number (ABN) are also required to submit a TPAR. The Australian Taxation Office (ATO) has set the due date for lodgement as 28 August 2024. Failing to lodge on time could result in penalties.
What is the TPAR?
The Taxable Payments Reporting System (TPRS) is designed to ensure that contractors in these specific industries accurately report their income. The system aims to create a level playing field, ensuring that all businesses meet their tax obligations fairly.
ATO Assistant Commissioner Tony Goding emphasized the importance of the TPAR in maintaining tax compliance. “TPAR data strengthens our ability to detect and deal with dishonest operators trying to gain an unfair advantage over the majority who do the right thing.
“It also protects billions of dollars in missing taxes each year, money that funds essential community services, like health, education and natural disaster management.
“In the 2023–24 financial year, we provided visibility of more than $451 billion in gross TPAR payments from almost 177,000 businesses to almost 1.3 million contractors. In doing so, we have helped contractors complete their income tax returns through the pre-fill and transaction services report.”
Key Achievements of the TPRS
In the 2023–24 financial year alone, the TPRS provided visibility into more than $451 billion in gross payments reported by nearly 177,000 businesses to around 1.3 million contractors. This data has been instrumental in helping contractors complete their income tax returns through the ATO’s pre-fill and transaction services report.
Between 2019 and 2023, the ATO issued approximately $9 million in penalties to over 5,200 businesses that failed to lodge their TPAR. These penalties underscore the importance of compliance with TPAR requirements.
Lodging Your TPAR
The ATO encourages businesses to lodge their TPAR online, as the process is quick and straightforward. For businesses uncertain about their obligation to lodge, resources are available at www.ato.gov.au/TPAR. Additionally, businesses can consult their registered tax or BAS agent for assistance.
As the 28 August deadline approaches, it’s crucial for businesses to review their reporting obligations and ensure they meet the requirements to avoid penalties.
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