Contractors, or tradies, in the building industry, are being targeted by the ATO (Australian Taxation Office) in an effort to recover undeclared income and unsettled GST. The Tax Office has always been focused on the cash economy, but with the introduction of a new reporting process in 2013, construction companies are now required to report all payments they make to contractors. The ATO hopes that this new rule will allow them to catch more contractors.
Thousands of contractors have been caught, to date…
Over 250,000 tradies with over $2.3 billion in tax liabilities for not paying their income tax and GST have been hit by the ATO. Contractors should heed the warning – the ATO is going after you!
Forget about fishing for a while and focus on catching up with your bookkeeping to keep the ATO off your back. Gather your receipts, invoices and records and input the figures into a good accounting software solution. This will take away your worry and you can think about visiting your favourite fishing spot.
Make sure your accounting records are correct and all your lodgement obligations are up to date. If you do not have the time, then enlist the help of a bookkeeper.
Using accounting software offers many benefits:
- You’ll gain better insight into the workings and performance of your business. You can record and save all accounting information in a single convenient location. You can print financial reports to know if your business is performing well or not with a press of a button.
- It allows you to meet your tax requirements such as income tax and GST without any trouble.
- You save time doing your tax every year because all information is already entered into the software during the year. You don’t have to be overwhelmed going through all the paperwork. This gives you more time to focus on making money instead of doing paperwork.
- Better business decision-making is the result of having up to date information. Accounting information can be accessed anytime and this would help you to easily compare business performance over diverse periods of time.
- It helps if you get audited by the ATO. You have all your accounting information on hand.
- You can easily track the payments you make to your customers and suppliers, allowing you to organise your cash flow better.
With the ATO focusing more than ever on contractors, builders and tradies with regards to income tax and GST payments, be proactive.
For tax advice or guidance, contact PJS Accountants. We offer expertise in managing your tax affairs with a full range of compliance, corporate and individual tax services, whether you are a large company, SME, family business or individual. Tax laws and requirements change constantly, potentially putting you or your businesses at risk. Have a chat with one of our expert advisers now and ensure you are meeting your tax obligations.