Under the taxable payments reporting system (TPRS), some businesses may need to report the total payments they made to contractors for relevant services. Also government entities may need to report payments they made for services and grants paid to people and organisations with an Australian business number (ABN).
These payments need to be reported to the ATO in a Taxable payments annual report (TPAR) by 28 August each year.
Not required report
There are certain circumstances where TPAR reporting is not required.
For more information, visit TPAR Non-lodgment advice.
Federal, state, territory and local government entities need to report the total payments they make to an entity, wholly or partly, for providing services.
Additionally, federal, state and territory government entities will need to report the total grants paid to people or organisations that have an ABN. Local government entities don't need to report grants.
They need to report details of these payments and grants on the Taxable payments annual report (TPAR) by 28 August each year.
Reporting by businesses in the building and construction industry
Under Division 405 of Schedule 1 to the Taxation Administration Act 1953 (TAA), payers are required to report to the ATO details of payments made to suppliers as specified in the regulations. Regulation 70 of the Taxation Administration Regulations 2017 specifies businesses primarily in the building and construction industry that make payments to a supplier for building and construction services are required to report. This measure commenced on 1 July 2012.
Reporting by government entities
Under Subdivision 396-B of Schedule 1 to the Taxation Administration Act 1953 (TAA), government entities at the federal, state/territory and local levels are required to report to the ATO payments they make to an entity for the provision of services. In addition, government entities at the federal and state/territory levels will also be required to report grants paid to entities with an ABN. This measure commenced on 1 July 2017.
Certain types of government entities are exempt from reporting, as are certain transactions.
Reporting by businesses that provide:
- cleaning services
- courier or a road freight service
- security, investigation or surveillance services
- information technology services
Under Subdivision 396-B of Schedule 1 to the TAA, an ABN holder that provides cleaning, courier, road freight, security, investigation, surveillance or information technology services is required to report to the ATO payments they make to an entity to provide those services on their behalf, unless a reporting exemption applies.
To find out the specifications that should be used to create software for the electronic lodgment of the TPARs, refer to Taxable payments annual reports (TPAR) specification.