Do You Need to Report?
If your business gets 50% or more of its income from supporting construction and building services or if 50% or more of your businesses daily activity is related to the construction or building industry, you are considered to be a primarily building and construction based entity. This means you have to report as such.
Examples of Construction or Building Services
If you're still not sure if your business qualifies to a building industry professional, this will help you. The term 'construction and building services' is a deceptively large one and it can be confusing at first glance, which is why it is important to have the professional and friendly staff at EtaxPlus help you lodge your taxes correctly. We'll save you time and money each time we help you.
- Architectural Work - Design, Drafting
- Block and Brick Laying
- Cabinet Making - Joinery and Off-Site Fabrication
- Communications and Cable Laying
- Component Installation - Sewage, Solar Devices, Tanks, Windows, Heating and Cooling, Insulation
- Construction and Demolition
- Decorating, Tiling, Painting, and Wallpapering
- Electrical Machinery and Electrical Work
- Equipment Rental with Operator
- Irrigation, Landscaping, and Stonework
- Pre-Fabricated Homes - Assembly, Erection, and Installation
- Retaining Wall Building, Roofing, and Guttering
- Room Component Building - Bathroom and Laundry Components, Kitchens, and Cupboards
- Surfaces - Asphalt and Bitumen Work
- Swimming Pool Installation and Maintenance
- Weatherboarding and Waterproofing Measures
Examples of Buildings, Structures, Surfaces, and Works
These are the things you must report that the ATO considers a building, structure, surface, or work. If you don't do this correctly, you might have to amend your taxes, and this is a hassle you shouldn't have to deal with.
- Apartments and Breakwaters
- Bridges and Canals
- Commercial Buildings and Communications
- Dams and Duplexes
- Electricity Power Plants and Highways
- Flats, Footpaths, and Guttering
- Furnaces and Garages
- Industrial Buildings and Jetties
- Lakes and Mine Sites
- Oil Refineries and Pipeline
- Parking Lots and Power Plants
- Railways and Roads
- Sheds and Sports Fields
- Transmission Towers (Television or Radio)
- Tunnels and Waterworks
What Payments Do You Have to Report?
If this classification suits your business, you will have to report any and all payments you make to contractors if you meet both criteria:
If you get invoices that have the cost of labour and materials listed in either a combined or itemized list, you must report the entire payment amount unless your labour costs are directly secondary to the delivery of the goods or products. You have to report costs if they directly relate to the building project in the following ways:
- Alteration and Assembly
- Construction or Demolition
- Design and Destruction
- Dismantling or Erection
- Excavation or Finishing
- Improvement or Installation
- Maintenance - Excluding Tool Costs
- Managing Building and Construction Services
- Modifications or Organization of the Building or Construction Services
- Removal or Repair
What Details Will You Need to Report Correctly?
For each contractor your work for, you have to report a set of individual details for each one. This will make the entire process of lodging your taxes easier and more streamlined
- Australian Business Number (ABN)
- Current Residential and Mailing Address
- Contractor's Full Name
- The Gross Amount Paid for the Financial Year (including GST)
If you pay a contractor in cash, you are required to report this at the end of the financial year, and you can find these details on the invoices you get from each entity. Tax time can be a confusing and stressful time for anyone, let alone a business that works in the building industry. At EtaxPlus, we are skilled and ready to assist you with all of your tax lodging needs. Contact us this tax season and let us give the peace of mind that comes with knowing that you have lodged your taxes correctly.
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