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Your TPAR is now due!
Tax deadline is fast approaching for Taxable payments annual report (TPAR)
As the new financial year begins, it's a good opportunity to assess whether your business is actually required to complete the TPAR. Not all businesses are obligated to do so, so it's worth checking to see if it applies to your specific situation.
The Taxable Payments Annual Report (TPAR) is an important document that businesses need to complete and send to the Australian Taxation Office (ATO).
This report includes details about payments made to suppliers over the course of the year.
🟠 What to report
You need to report the total payment amount if an invoice you receive from a contractor includes both labour and materials.
This includes businesses that operate in the following industries:
🟠 Building and construction services.
🟠 Cleaning services.
🟠 Road freight and Courier services.
🟠 IT services.
🟠 Security, investigation or surveillance services.
If your business is in that camp, don’t forget that the annual deadline for submitting the TPAR form is on August 28th.
If you do not lodge on time, you may have to pay a penalty.
(In the past year, around $400 billion was paid to nearly 1.1 million workers who are called contractors. All these payments were recorded in something called TPARs, which are like special reports.
Lately, the tax office (ATO) gave out over 16,000 fines to businesses. These fines happened because those businesses didn't send their special reports (TPARs) to the tax office like they were supposed to, even after being reminded many times by the tax office. The average fine for not sending these reports was about $1,110)
🟠 How to Submit
You have two options for submitting it:
🟠 you can either do it directly yourself,
🟠 or you can use a service provided by the ATO to help you with the submission process.
“If you have not kept up-to-date supplier records throughout the year, start updating your records now to ensure timely TPAR lodgement."
🟠 Things to review before finalising your TPAR:
Ensure a clear understanding of which suppliers must be included in the TPAR while identifying those that may qualify for exclusion.
Verify the accuracy of current particulars concerning pertinent suppliers, encompassing their Australian Business Number (ABN), business nomenclature, and physical business locale.
Scrutinize supplier reports to ascertain the aggregate sum disbursed within the fiscal year, inclusive of the embedded Goods and Services Tax (GST) component.
In the event that a practice of scrutinizing ABN and GST registrations of all suppliers has not been habitual, it is advisable to engage in such diligence now. Is the ABN provided by your suppliers accurate, and does it correspond with their GST registration status as indicated on their invoices?
Assess the availability of valid tax invoices for the entirety of transactions conducted with supplier entities germane to business operations.
The majority of contemporary accounting software suites offer streamlined provisions for the facile establishment and maintenance of supplier clusters pertinent to the TPAR schema, thereby facilitating a seamless preparatory process for the annual report.
It's important to lodge on time, as ATO uses the reported information to:
Provide pre-entered details for independent contractor sole traders, aiding them in the formulation of their income tax declarations.
Render this information accessible within the reported transactions feature integrated into ATO's online platforms.
Discern contractors who are not fulfilling their tax responsibilities.
One crucial thing to keep in mind is that you should have accurate and up-to-date records of all the suppliers you've made payments to throughout the year.
Staying organized and meeting the submission deadline will help your business fulfill its obligations smoothly.
If you haven't been maintaining these records, it's important to start organizing them now. This will ensure that you can meet the deadline for submitting the TPAR on time.
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