TPAR

Incidental labour
Exclude the labour amount for invoices that list both materials and labour. Do this if the labour is incidental to the supply of materials.

Contractors who do not quote an ABN
If an ABN is not provided, you may need to withhold an amount from the payment for that supply under the PAYG withholding arrangements and report the amounts withheld in the TPAR.

Payments within consolidated groups
If you are in a consolidated or multiple entry consolidated group for income tax purposes, you do not need to report payments made to another member of that same group.

This is because members of a consolidated group or multiple entry consolidated group are taxed as a single entity.

You only need to report payments to contractors for services who are outside the consolidated group.

Payments for private and domestic projects
You do not need to report if you are:

• an individual who is not running a business and you make payments to contractors for services

for example, if you are a homeowner building or renovating your main residence

• a business making payments to contractors for services for private purposes

for example, cleaning your own home.

If the work is related to carrying on a business, the amounts paid to the contractors for this work must be reported. These are payments that businesses can claim as a tax deduction.

You do not need to report payments made:

• for goods only, which includes any form of tangible property
• made to other Australian government entities
• made electronically by

– BPAY
– recurring direct debit
– credit or debit card
– third-party payment processors facilitating any of the above methods

• for telephone and internet services
• for electricity, water, sewerage or gas
• for transportation of employees. This includes airfares, taxi fares, train or bus fares, or fares for water transport
• for insurance
• for accommodation in commercial premises. For example, rent payments
• for accommodation in a hotel, motel, inn, hostel, boarding house, caravan park or camping ground
• for a lease of goods
• for the creation, grant, transfer, assignment or use of a right under licence. For example, a licence to use a software product
• for financial supplies. For example, bank fees
• for membership to a professional association or body
• for services relating to court or tribunal functions. For example, payments to jurors, witnesses or advocates for minors.

Speak to your software provider on how best to exclude these payments from your report. However, we will accept these types of payments if it creates an increased administrative burden to exclude them.

Unpaid invoices as of 30 June each year

Only report payments that have been paid on or before 30 June each year.

For example, if you receive an invoice in June but you do not pay that invoice until July, report that payment in the next financial year (the year you paid it).

PAYG withholding payments

Report PAYG withholding payments in your PAYG withholding annual report or through Single Touch Payroll (STP).

Do not report in PAYG withholding payments in your TPAR.

Examples include payments to:

• employees
• workers engaged under a voluntary agreement to withhold
• workers engaged under a labour-hire or on-hire arrangement. This includes a labour hire firm that hires workers under a labour-hire arrangement to provide services.

Payees who do not quote an ABN

If an ABN is not provided, you may need to withhold an amount from the payment for that supply under the PAYG withholding arrangements.

Report the amounts withheld in either the:

• TPAR
• PAYG payment summary withholding — where ABN not quoted.

Report this information in one of these annual reports, not both.

If a supplier does not provide an ABN, see Statement by a supplier not quoting an ABN.

If you are running a business primarily in the building and construction industry, you must lodge a Taxable payments annual report (TPAR) if you:

• make payments to contractors or subcontractors for building and construction services
• have an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When a business operates primarily in building and construction services

You are considered to be a business that primarily operates in building and construction services if any apply:

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

To determine if an entity is in the building and construction industry, see Subregulation 64(6): Taxation Administration Amendment Regulation 2012 (No.1)

What are building and construction services

Only report payments you make to contractors for building and construction services.

Contractors can be sole traders, companies, partnerships or trusts.

The definition of building and construction services is broad. It can include any of the activities listed below if they are performed on, or in relation to, any part of a building, structure, works, surface or sub-surface:

• alteration
• assembly
• construction
• demolition
• design
• destruction
• dismantling
• erection
• excavation
• finishing
• improvement
• installation
• maintenance, excluding the maintenance, service or repairs of equipment and tools
• management of building and construction services
• modification
• organisation of building and construction services
• removal
• repair, excluding the service or repairs of equipment and tools
• site preparation.

Examples of building and construction services

The following occupations and work activities satisfy the definition of building and construction services:

• architectural work, including drafting and design
• asphalt and bitumen work
• assembly, installation or erection of prefabricated houses
• block laying
• bricklaying
• building of room components. For example, kitchens, bathroom components,
• laundry components, cupboards and similar components
• cabinet making, including joinery and off-site fabrication for installation at a
• building site
• cable laying
• communications construction
• concreting, including formwork, pouring and finishing
• construction and sealing roads
• construction management
• decorating
• demolition
• distribution line construction
• drainage work
• dredging
• earthworks
• electrical machinery, heavy, installation (on-site assembly)
• electrical work, including electrical inspection
• electrical construction
• elevator and escalator installation and work
• engineering
• equipment rental with operator. If there is no operator, it is rental of a good and not a building and construction activity
• erection of frames
• erection of scaffolding
• excavation and grading
• fencing
• finishing
• flood control system construction
• flooring. For example, tiling, laying carpet, laying linoleum, timber flooring,
• floating floors, resilient flooring, slate tiles and similar flooring
• foundation work
• gas plumbing
• glass and glazing work
• hanging or installing doors
• installation of fittings
• installation of hard-wired alarm systems. For example, security, fire, smoke and
• similar alarms
• installation of hot water systems
• installation of prefabricated components. For example, kitchens, bathroom components, laundry components, cupboards and similar components
• installation of prefabricated temperature-controlled structures
• installation of septic tanks
• installation of solar devices. For example, hot water or electricity connections
• installation of tanks
• installation of window frames
• installation of windows
• installation or work on devices for heating and cooling
  insulation work. For example, walls, roofs, windows and similar structures
• internet infrastructure construction
• irrigation system construction
• land clearing
• landscaping construction, including paving and design
• levelling sites
• painting. For example, internal and external surfaces, including roofs
• pile driving
• pipeline construction
• plastering or other wall and ceiling construction
• plumbing work, including plumbing inspection
• preparation of site
• project management
• rendering or other internal or external surface finishes
• retaining wall construction
• river work construction
• roofing and guttering
• sewage or stormwater drainage system construction
• stonework
• surveying
• swimming pool installation
• swimming pool construction. For example, below ground concrete or fibreglass
  tiling. For example, walls and similar structures
• timber work
• wallpapering
• waterproofing interior and exterior surfaces
• weatherboarding.

Examples of buildings, structures, works, surfaces or sub-surfaces

The following is a list of what we consider to be buildings, structures, works, surfaces or sub-surfaces:

• aerodrome runways
• apartments
• breakwaters
• bridges
• canals
• commercial buildings
• communications, internet and electrical infrastructure
• dams
• duplex houses
• electricity power plants
• elevated highway
• flats
• footpath, kerb and guttering
• furnaces
• garages
• golf courses
• harbour works
• high-rise flats
• highways
• housing buildings, including prefabricated housing
• industrial buildings
• jetties
• lakes
• mine sites
• office buildings
• oil refineries
• parking lots
• pipelines
• power plants
• railways
• roads
• semi-detached houses
• sewage storage and treatment plants
• sheds
• sports fields
• streets
• television or radio transmission towers
• tunnels
• water tanks
• waterworks.

You must lodge a Taxable payments annual report (TPAR) if:

• your business provides courier services to other people or businesses
• you paid contractors or subcontractors to provide these courier services on behalf of your business
• you have an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When your business provides courier and other services

If courier services are only part of what your business provides, you may need to fill out a TPAR.

You should:

• work out how much of your business income came from courier services
• add up the money your business was paid for providing courier services for the financial year. A financial year is the 12 months from 1 July to 30 June
• include payments for services provided by both employees and contractors or subcontractors
• work out the total amount of your business income for the year.

If an arrangement with your customer involves providing both goods and courier services, determine if the courier services are either:

• composite supply of delivering the goods: delivery is essential to the supply of the goods. Therefore, the delivery involved is not a ‘courier service’
• mixed supply of courier services and goods: the delivery part of the service is a large cost or could be made as a separate supply. For example, the delivery part is a ‘courier service.’

If the total payments, you receive for courier or delivery services are:

• 10% or more of your gross business income: you must lodge a TPAR
• less than 10% of your gross business income: you do not lodge a TPAR.

From 1 July 2019, if your business provides courier and road freight services, you must combine the payments you receive for both services. Do this when you work out if you need to lodge a TPAR.

You can also choose to lodge a TPAR even if you are:

• under the 10% threshold
• unsure if you will be under the threshold.

Examples of courier services

Courier services are when items or goods are collected from or delivered to any place in Australia using the following methods:

• bicycle or other non-powered means of transport
• drones
• on foot
• vehicles, including:
  • car
  • motorcycle
  • motorised scooter
  • station wagon
  • truck
  • ute
  • van.

Courier services are usually door-to-door services. These services are used for specialty deliveries or for small parcels or packages.

Goods transported using courier services mostly include parcels, packages, letters and food.

If you sell goods and give the option of a delivery service, you are supplying a courier service.

Courier services do not include:

• delivering goods your business provides. For example, if delivery is the only way your customers can receive the goods
• passenger transport services. For example, buses and taxis
• freight transport from one location to another. This includes transporting large quantities of items, goods or commodities by:
  • air
  • rail
  • road. This is usually by heavy vehicle trucks or larger vehicles
  • sea.

You must lodge a Taxable payments annual report (TPAR) if all conditions are met:

• your business provides cleaning services to other people or businesses
• you paid contractors or subcontractors to provide these cleaning services on behalf of your business
• your business has an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When your business provides cleaning and other services

If cleaning services are only part of what your business provides, you may need to fill out a TPAR.

You should:

• work out how much of your business income came from cleaning services
• add up the money your business was paid for providing cleaning services for the financial year. A financial year is the 12 months from 1 July to 30 June
• include payments for services provided by both employees and contractors or subcontractors
• work out the total amount of your business income for the year.

If the total payments, you receive for cleaning services are:

• 10% or more of your gross business income: you must lodge a TPAR
• less than 10% of your gross business income: you do not lodge a TPAR.

You can also choose to lodge a TPAR even if you are:

• under the 10% threshold (see examples below)
• unsure if you will be under the threshold.

Examples of cleaning services

Cleaning services can include, but are not limited to, the following cleaning activities:

• carpet
• chimney
• exterior, except sandblasting
• gutter
• interior
• park and park facilities
• road and street sweeping
• swimming pool.

The cleaning services can be done on:

• buildings
• equipment
• events, including:
  • agricultural
  • cultural
  • entertainment
  • scientific
  • staging of sporting
  • technological
• exhibitions
• industrial machinery
• places
• residences. For example, homes
• surfaces
• structures
• transport vehicles, including:
• airplanes
• buses
• cars and other motor vehicles
• ferries
• ships
• trains
• trams
• trucks.

You must lodge a Taxable payments annual report (TPAR) if all conditions are met:

• your business provides information technology (IT) services to other people or businesses
• you paid contractors or subcontractors to provide these IT services on behalf of your business
• you have an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When your business provides IT and other services

If IT services are only part of what your business provides, you may need to fill out a TPAR.

You should:

• work out how much of your business income came from IT services
• add up the money your business was paid for providing IT services for the financial year. A financial year is the 12 months from 1 July to 30 June
• include payments for services provided by both employees and contractors or subcontractors
• work out the total amount of your business income for the year.

If the total payments, you receive for IT services are:

• 10% or more of your gross business income: you must lodge a TPAR
• less than 10% of your gross business income: you do not lodge a TPAR.

You can also choose to lodge a TPAR even if you are:

• under the 10% threshold
• unsure if you will be under the threshold.

Engaging overseas contractors

If you are providing a relevant IT service and engaging a contractor to provide that service on your behalf, the payment to that contractor is reported in the TPAR.

Contractors can be located outside of Australia and may not have an ABN. There is no exclusion based on the location or tax residency of the payee.

If an ABN is not provided, you may need to withhold payment under the pay as you go (PAYG) withholding arrangements.

Examples of IT services

IT services can be completed at a work site or online.

Some examples of IT services include:

• computer facilities management
• computer hardware consulting
• computer network systems design and integration
• computer programming
• computer software consulting
• customised software development
• internet and web design consulting
• IT consulting
• software installation
• software simulation and testing
• systems analysis
• technical support.

Examples of activities that are not IT services include:

• using IT hardware or software in your business to provide a service (other than an IT service)
  • for example, you would not be providing an IT service if your business uses software
• to operate an accounting, project management or word processing business
• mass producing computer software. For example, reproduction of recorded media
• the leasing or hiring out of computers or other data processing equipment
• providing data processing services or computer data storage and retrieval services
  installing computer cables.

 

You must lodge a Taxable payments annual report (TPAR) if all conditions are met:

• your business provides road freight services to other people or businesses
• you paid contractors or subcontractors to provide these road freight services on behalf of your business
• you have an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When your business provides IT and other services

If road freight services are only part of what your business provides, you may need to fill out a TPAR.

You should:

• work out how much of your business income came from road freight services
• add up the money your business was paid for providing road freight services for the financial year. A financial year is the 12 months from 1 July to 30 June
• include payments for services provided by both employees and contractors or subcontractors
• work out the total amount of your business income for the year.

If an arrangement with your customer involves providing both goods and road freight services, you need to determine if the road freight services are either:

• composite supply of delivering the goods: the delivery is essential, ancillary or incidental to the supply of the goods. Therefore, the delivery involved is not a ‘road freight service’
• mixed supply of road freight services and goods: the delivery part of the service is a large cost or could be made as a separate supply. Therefore, the delivery part is a ‘road freight service.’

If the total payments, you receive for road freight services are:

• 10% or more of your gross business income: you must lodge a TPAR
• less than 10% of your gross business income: you do not lodge a TPAR.

From 1 July 2019, if your business provides road freight and courier services, combine the payments you receive for both services. Do this when you work out if you need to lodge a TPAR.

You can also choose to lodge a TPAR even if you are:

• under the 10% threshold (see examples below)
• unsure if you will be under the threshold.

You must lodge a Taxable payments annual report (TPAR) if:

• your business provides security, investigation or surveillance services to other people or businesses
• you paid contractors or subcontractors to provide these security, investigation or surveillance services on behalf of your business
• you have an Australian business number (ABN).

Payments made to employees are not reported in your TPAR.

Each year, you must:

• review if you need to lodge a TPAR
• report these payments on your TPAR by 28 August.

When your business provides security, investigation, surveillance and other services

If security, investigation or surveillance service are only part of what your business provides, you may need to fill out a TPAR.

You should:

• work out how much of your business income came from security, investigation or surveillance services
• add up the money your business was paid for providing security, investigation or surveillance services for the financial year. A financial year is the 12 months from 1 July to 30 June
• include payments for services provided by both employees and contractors or subcontractors
• work out the total amount of your business income for the year.

If the total payments, you receive for security, investigation or surveillance services are:

• 10% or more of your gross business income: you must lodge a TPAR
• less than 10% of your gross business income: you do not lodge a TPAR.

You can also choose to lodge a TPAR even if you are:

• under the 10% threshold
• unsure if you will be under the threshold

Example of security, investigation or surveillance services

Security services

Security services include patrolling, protecting, screening, watching or guarding any people, premises or property by any means.

Investigation services

Investigation services include searching inquiries by any means into one or more specific individuals or matters. The purpose of these inquiries is to decide on the facts or gather evidence.

Investigation services

• relate specifically to security and surveillance
• involve more than information gathering
• do not include routine record or police checks, or telemarketers conducting surveys.

Surveillance services

Surveillance services include watching or observing an area or location and monitoring security systems. These services may overlap with security services.

Examples of security, investigation or surveillance activities include:

• alarm monitoring and response
• armoured car service
• body guarding or close personal protection
• burglary protection
• crowd, event or venue control
• detective agency service
• lock smithing
• night watch service
• operating a security control room or monitoring centre
• operating security screening equipment. For example, prohibited item detectors, xray scanners and explosive trace detection
• security guard service.

Security, investigation or surveillance services do not include:

• academic or market research
• manufacture or retail of security, investigative or surveillance devices. For example, security alarms, cameras or voice recorders
• manufacture, retail, installation, maintenance or repair of fire alarm systems
• police services
• providing aerial surveying or mapping services
• providing key cutting or duplication services
• surveillance of country borders.