Tradies Tax can help!
The Australian Taxation Office has discovered 280,000 businesses yet to lodge their Taxable Payments Annual Report for 2019/2020.
A reminder has been sent out to businesses who have failed to lodge a Taxable Payments Annual Report for 2019/2020, after it was reported many businesses have fallen behind on mandatory tax lodgments because of the 2020 COVID-19 pandemic.
Here, we will break down what a Taxable Payments Annual Report lodgment is, which industries are required to lodge one, and who tradesman should contact if their business is yet to make their lodgment.
What is a Taxable Payments Annual Report?
A Taxable Payments Annual Report (TPAR) is a yearly lodgment with the Australian Taxation Office (ATO) as a means of helping Australian tradesman compete on a level playing field. It identifies dishonest contractors who under-report their income, allowing there to be no unfair advantages. The TPAR system applies to the building and construction industry, and those paying contractors for building and construction services.
Who is Required to Lodge a Taxable Payments Annual Report?
The TPAR system was instigated to help tackle the black economy and was first implemented into building and construction services in 2013, before being extended to cleaning and courier services in 2018, and road freight, IT, security, investigation, and surveillance services, as well as government entities in 2020.
Currently, the ATO has identified 60,000 businesses that have failed to lodge returns under the Taxable Payments Reporting System for the 2019/2020 period. This act has the potential to cost the Australian economy $50bn if not reported correctly.
Overall, 280,000 businesses are required to lodge their TPAR for 2019/2020 as soon as possible, to avoid failure to lodge penalties. This report was due on August 28, 2020. If your trades business has not yet lodged its 2019/2020 TPAR, it is now well overdue.
2020 was the first year many businesses had to lodge a TPAR with the ATO due to the COVID-19 pandemic forcing businesses to contract out more services, unknowingly placing themselves under the Taxable Payments Reporting System. ATO Assistant Commissioner Peter Holt has expressed the ATO’s willingness to help struggling businesses, stating:
“Our first priority is to support businesses who need help. That’s why we are reminding people of their obligations to help them stay on track…”
“We encourage those businesses to lodge if they can, or call us if they need assistance or more time to lodge…”
My Business is Yet to Lodge its 2019/2020 Taxable Payments Annual Report; What Do I Do Now?
If your trades business is one of the 280,000 the ATO are waiting on to lodge their 2019/2020 TPAR, you can either lodge it online through the ATO website, order a paper lodgment, or contact your tax professional to lodge it for you.
If your accountant does not specialize in working with trades businesses, please feel free to contact Tradies Tax today to help lodge your TPAR and get the best possible outcome!