There are some unique challenges in the In the construction industry that it pays to be aware of and prepared for. With regulation and taxation obligations, it makes sense to ensure you’ve got the right systems in place BEFORE reporting time arrives.
QBCC Reporting
If you’re in the construction industry in Queensland, there have been some significant changes made to the QBCC reporting requirements. For all QBCC licence holders, Minimum Financial Reporting (MFR) reports will be required to be lodged with the QBCC, either on a self-certifying basis, or with a signed accountants report including financial statements, (completed to Australian accounting standards).
It’s important to keep this in mind when structuring your construction business and its assets, as there are obligations for minimum Net Tangible Assets, determined by the revenue earned in the accounting period. Discussing this with your accountant as part of your overall business planning strategy could prevent significant licensing issues later in the year.
Taxable Payments Annual Report
By the 28th August each year, construction industry businesses are required to provide a Taxable Payments Annual Report to the Australian Tax Office. This report collects data on payments made to contractors, whether operating as a sole trader, partnership, trust or company.
The TPAR requires the following information:
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Name
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Address
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ABN (if known)
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Gross amount paid for the financial year (including GST if relevant).
We recommend you have this information available before the end of financial year (ideally, when engaging the contractor) to reduce the burden of follow up otherwise required in July.
Single Touch Payroll
Although Single Touch Payroll already applies to all employers with 20 or more employees, Parliament has recently agreed to extend STP to all employers, from 1 July 2019. It is still required to receive Royal Ascent, however we don’t believe this will delay STP implementation. Single Touch Payroll requires employers to send (via their payroll or accounting system) wage payment details, allowances, deductions, superannuation and taxation information straight to the ATO, when the payroll is processed.
This process will remove the need for annual payment summaries to be provided to employees, who will instead be able to access this information through their my.Gov account.
Although STP will apply to all industries, we understand that many businesses in the construction industry still rely on paper accounting and payroll methods. This means that ideally, implementing improved practices for payroll systems before July 2019 will allow a seamless transition to the new reporting standards.
If your construction industry business is facing what seems like endless challenges and paperwork, talk to the team at Tax Strategies Australia. Our no-fuss, solution-focused approach means you can focus on growing your business in a strategic, profitable way. Contact us today for your free construction industry financial reporting review.
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