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As the 28 August due date for the Taxable payments annual report (TPAR) approaches, now is the time for businesses to work out if they need to lodge this year to report payments made to contractors in 2020–21.
Small Business Tax Tips
Don’t forget to include all your income!
Remember, it’s important to include all your income in your income tax return. This includes cash and digital payments, vouchers or coupons, assessable government grants and payments like JobKeeper, personal services income, investment income and bank interest, and income from the sharing economy. Find out more at ato.gov.au/businessincome
Understanding your business deductions this tax time
You can claim a deduction for most of the costs of running your business. For example, did you know you may be able to claim deductions for expenses related to COVID-19 safety such as hand sanitiser, sneeze or cough guards, other personal protective equipment and cleaning supplies? Find out more about the three golden rules at ato.gov.au/businessdeductions
Five rules for good record keeping
Good record keeping throughout the year (knowing what records you need to keep and making sure they are complete and accurate) will make things easier when it’s time to do your tax. Learn the five rules for record keeping at ato.gov.au/recordkeeping
Happy retirement to the Business Portal
The Business Portal retires at the end of July. Business clients should switch to Online services for business to interact online with the ATO going forward. Online services for business makes it quick and convenient to lodge activity statements, create a payment plan, or send secure mail to the ATO. Helpful user guides, and log in information is available at ato.gov.au/osb
Businesses who pay contractors may need to lodge a Taxable payments annual report (TPAR) this year, due 28 August
As the 28 August due date for the Taxable payments annual report (TPAR) approaches, now is the time for businesses to work out if they need to lodge this year to report payments made to contractors in 2020-21.
Some businesses may need to lodge a TPAR for the first time, for example:
- They paid contractors to provide certain services on behalf of their business including courier and road freight, information technology, security, investigation or surveillance and cleaning
- Where these services are only part of what your business provides, you may need to fill out a TPAR if 10% or more of your income is received from these services.
- Where they are in building and construction and make payments to contractors for building and construction services and 50% or more of their business income or activity relates to building and construction services.
The ATO uses the information provided in TPARs to help contractors complete their income tax returns so it’s important to lodge by 28 August. It’s easy to lodge online, or through a registered tax or BAS agent. Businesses should already have the records they need from preparing their activity statements. If businesses work out they don’t need to lodge a TPAR, they can lodge a Non-lodgment advice to let the ATO know to update their records and avoid unnecessary follow-up.
The reporting rules differ depending on what services are provided - it is important they check how the rules apply to them. The ATO has information to help businesses work out if they need to lodge a TPAR this year, with examples of services if they are unsure. Their website explains what information you need to include, and how to lodge. Go to www.ato.gov.au/TPAR.
Single Touch Payroll
Single Touch Payroll (STP) Phase 2 reporting starts 1 January 2022, and our STP Phase 2 employer reporting guidelines are now available.
Employers impacted by COVID-19 can finalise their employees’ end-of-year income statement through Single Touch Payroll up until 31 July. If your clients need additional time, they will need to apply for a deferral.
ATO’s free Tax Help Program
The ATO’s Tax Help program is a free and confidential community service that aims to help taxpayers with simple tax affairs who earn less than $60,000 annually, to prepare and lodge their tax returns online using myTax. Among our other support services available, Tax Help is available until the end of October across Australia and is run by ATO-trained community volunteers. Volunteers will deliver this service in the following ways:
- In person at Tax Help centres across Australia
- Online through virtual assistance
- Over the phone
- In some locations, Tax Help is available in languages other than English. Let your community know they can make an appointment by phoning us on 13 28 61 or visit our website for more information www.ato.gov.au/taxhelp