Businesses in the building and construction industry must now report to the Australian Taxation Office (ATO) the total amount they have paid contractors for building and construction services or risk review or audit and may face penalties.
The ATO will compare this information with the income that is included in their tax return.
John Leonard, assistant commissioner, Australian Taxation Office, said these new reporting requirements have been introduced to create a level playing field for businesses and improve tax fairness within the industry.
“Contractors who fail to meet their tax obligations can gain an unfair competitive advantage,” Leonard said.
“We will use the information reported to detect contractors who have not lodged tax returns or failed to include all their income in tax returns lodged.”
“We are asking contractors in this industry to make sure they include all their income in their tax return to avoid any penalties.”
The ATO has said that information to be reported each year by the business that paid the contractor must include the ABN, your name, address and total amount paid to you including any GST.
Businesses are also being asked to remember to lodge their 2012-13 tax return by the due date and include all your income; lodge any prior years’ tax returns as soon as possible and consider making a voluntary disclosure if they think they have made a mistake in a previously lodged tax return.
Where they voluntarily advise the ATO of any errors or omissions, any penalties that apply may be reduced.
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