The building industry has had this form of “enhanced reporting” since 2012-2013. The result was an additional $2.3 billion in income tax and GST liabilities collected through voluntary reporting in the first year alone.
The first annual report for affected cleaning and courier companies is due in August 2019. The types of information reported to the ATO about contractors include:
- ABN (where known)
- Name
- Address
- Total paid to the contractor (including GST) for the financial year, and
- Total GST included in the gross amount that was paid.
The extension of the taxable payments system was a recommendation of the Black Economy Taskforce. With the black economy estimated to be worth around $25 billion per year, it’s unlikely that the taxable reporting system will be limited to just the building, cleaning and courier industries. In its report to Government, the Taskforce recommends the further expansion of the system to include labour hire, owner-builders, the home improvement sector, and IT contractors.