ATO says $2.7bn protected from the black economy

Businesses in building and construction are required to lodge a TPRS annual report each year on any payments to contractors and subcontractors within the industry. This data allows the ATO to identify contractors who fail to lodge returns or activity statements, fail to register for GST, use false ABNs or fail to report all of their income to the ATO.

Deputy commissioner Deborah Jenkins said the TPRS is a key weapon in fighting the black economy and helps protect the integrity of the tax system.

"The significant revenue increase we’ve seen from the building and construction industry as a result of the TPRS shows how effective it is in improving tax compliance in an industry," Ms Jenkins said.

"TPRS strengthens our ability to match income tax returns from contractors against what businesses report paying, allowing us to detect those trying to hide income and evade tax."

She assured that businesses who are doing the right thing don’t need to worry.

Following a recommendation from the black economy taskforce, the TPRS has now been extended to cleaning, courier, road freight, information technology (IT), security, investigation and surveillance services. The taskforce identified these industries as high risk for black economy activity.

Ms Jenkins said the ATO is focused on supporting businesses in these industries to meet their reporting requirements.

"For the financial year 2018-19, businesses that supply courier or cleaning services need to report payments made to contractors they use to deliver those courier or cleaning services using the TPAR," Ms Jenkins noted.

"This will need to cover all relevant transactions from 1 July 2018 to 30 June 2019. The annual report for these businesses is due by 28 August 2019."

She urged companies with inaccurate record keeping to review the way they keep records or to contact their professional adviser immediately.

Reporting for road freight, IT, security, investigation or surveillance services will be due by 28 August 2020, covering the 2019-20 financial year.