Building and Construction industry
On the 30th May the Assistant Treasurer released a consultation paper entitled "'Reporting of taxable payments for contractors in the building and construction industry'. outlining a proposed measure announced in the recent Federal Budget. This measure, if introduced, would take effect from 1 July 2012 and would impose further administrative requirements on businesses in the building and construction industry.
The measure would require construction and building businesses to report annually to the ATO all payments made to contractors and sub contractors for the financial year. Clearly, the ATO has identified compliance issues within this industry and is looking to prevent payments to contractors being claimed by business but not declared as income by the contractors. However, it would appear at first glance that once again small business will take up the work of the ATO and be further weighed down by administrative tasks from the ATO.
If you are a contractor you will need to be doubly sure that you are doing the right thing and declaring all income, from 1 July 2012 the ATO will know all about it. Let's hope that the implementation of this measure is a smooth one for the construction industry.