What the Black Economy Taskforce means to Geelong business owners!
Your friend Johnny is a recently qualified Geelong mechanic and has completed some work on your ageing courier delivery van. Because of your longstanding friendship, Johnny did the work for ‘mates rates’ and as a ‘cashy’ to benefit you both.
Since then, you have received a letter from the Australian Tax Office. And let me guess, the letter is in the bin?
Due to the mumble jumble of words on this letter, you didn’t read it and therefore have no idea about the Black Economy Taskforce! As soon as 28th August comes around, you will be regretting popping that bit of paper in the bin.
Why? You ask.
The Black Economy Taskforce is an ATO initiative focusing on banishing tax-free, cash payments within the construction industry. This is being achieved by using the Taxable Payments Annual Report – or ‘TPAR’. This report consists of all the payments a business has made to building and construction contractors who have completed service and it is to be lodged by 28th August each year! This includes subcontractors, consultants, and independent contractors. This is not dependent on the fact of whether they are sole traders, companies, partnerships or trusts.
As of 1 July, 2018, the TPAR has been extended to include the cleaning and courier services!
The process is fairly straight forward and includes details such as the contractors ABN, name, address and gross amount paid including GST.
As you read this, one of the following options will come to mind:
a. Yep, my spreadsheet is all up to date!
b. Uh oh! I haven’t recorded any of payments made to my contractors!
c. Whoops – I have pocketed a LOT of ‘cashies’ this year!
d. Hang on, I’m really confused!
If your option was a, then well done! If your option was b onwards, then we recommend that you contact your Geelong accountants, Next Level Accountants, to discuss how to overcome this and plan for the year ahead. Don’t get caught out!