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ATO Penalties for Overdue TPAR

ATO Penalties for Overdue TPAR

  • Thursday, 13 April 2023 08:03

Businesses and government entities who make payments to contractors may need to report these payments and lodge a Taxable payments annual report (TPAR).

Contractors can include subcontractors, consultants, and independent contractors. They can operate as sole traders (individuals), companies, partnerships, or trusts.

The TPAR is due by 28 August each year and includes details of payments made to contractors operating in certain industries such as building and construction, cleaning, road freight and courier services, security, and IT.

The Australian Taxation Office (ATO) has indicated that starting from 22 March 2023 it will be imposing failure to lodge penalties on taxpayers who have not lodged a taxable payments annual report (TPAR) for the 2022 or prior years and they have received three non-lodgement letters.

The failure to lodge penalty is based on the size of the entity and the length of time the lodgement is overdue. The maximum penalty is limited at 5 penalty units (or a multiple of the penalty unit amount). For small entities (assessable income or current GST turnover of less than $1 million) the limit would be $1,375. For medium entities (assessable income or current GST turnover of up to $20 million) the limit would be $2,750.




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