How to Lodge Your TPAR: A Step-by-Step Guide for Small Business Owners

Tax time can get a bit tricky, especially when it comes to the Taxable Payments Annual Report (TPAR). If you’re not familiar with it, TPAR is all about keeping things transparent when it comes to payments made to contractors—whether they’re registered for GST or not.

The ATO uses TPAR to make sure everyone is playing by the rules when it comes to their tax obligations. In this blog, we’ll break down what TPAR is, who needs to lodge it, and how you can file it effectively.

What is TPAR?

The Taxable Payments Annual Report (TPAR) is a report that certain businesses need to lodge with the Australian Taxation Office (ATO). It details payments to contractors and subcontractors for services rendered throughout the financial year. The report was introduced to ensure that contractors are meeting their tax obligations, and it plays a vital role in the ATO’s efforts to track and match income reported by contractors.

Who Needs to Lodge a TPAR?

Not all businesses are required to lodge a TPAR. This obligation primarily applies to businesses in specific industries, such as:

• Building and Construction Services: Including trades like plumbing, carpentry, and electrical work.
• Courier or Road Freight Services: Any transport services requiring labor.
• Cleaning Services: Interior and exterior cleaning of buildings, machinery, and event spaces.
• Information Technology (IT) Services: Software development, testing, and support.
• Security, Investigation, or Surveillance Services: Guarding, monitoring security systems, and investigations related to security.

If your business operates in any of these industries and pays contractors for their services, you will likely need to lodge a TPAR. The report is due by 28 August each year, covering the previous financial year’s payments.

Preparing to Lodge Your TPAR

Before lodging your TPAR, there are several steps you should take to ensure accuracy:

1. Maintain Accurate Records: Keep detailed records of all contractor payments, including:
                 • Contractor’s name
                 • Address
                 • Australian Business Number (ABN)
                 • Amount paid, including Goods and Services Tax (GST).
2. Verify Contractor Details: Ensure contractor’s ABN on the invoice matches your records. This can be done using the ABN Lookup tool or the ATO app.
3. Check Your Software: If your business uses software to manage finances, make sure it can generate a TPAR data file that meets the ATO’s reporting specifications.

How to Lodge Your TPAR

There are several methods for lodging your TPAR, depending on your business’s setup:

1. Using Business Software

If you use Standard Business Reporting (SBR)-enabled software, this is often the most efficient way to lodge your TPAR. This type of software can create a TPAR data file that meets the ATO’s specifications.

• Generate a TPAR Data File: Ensure your business software is SBR-enabled and generate the necessary TPAR data file.
• Lodge Online: Access the ATO’s Online services for business using your myGovID and Relationship Authorisation Manager (RAM) credentials. Navigate to “Lodgements” and select “Taxable payments annual report” to upload your TPAR data file.

This method allows you to save drafts, resume your work later, and view your lodgement history, making it convenient and user-friendly.

2. Online Services for Individuals and Sole Traders

If you’re a sole trader or don’t have SBR-enabled software, you can still lodge your TPAR online.

• Log In via myGov: Use your myGov account, linked to the ATO, to access Online services for individuals and sole traders.
• Lodge Directly: Navigate to “Tax,” then “Lodgements,” and select “Taxable payments annual report.” Enter your data directly into the online form and submit.

3. Through a Tax or BAS Agent

For those who prefer expert assistance, a registered tax or BAS agent can lodge the TPAR on your behalf.

• Agent Services: Your agent can use SBR-enabled software or the ATO’s Online services for agents to manage the lodgement process. This service ensures accuracy and compliance, freeing you to focus on other aspects of your business.
  
  

4. Paper Form

Although less common, businesses can lodge a TPAR using a paper form.

• Order the Form: If needed, order the “Taxable payments annual report (NAT 74109)” form from the ATO’s publications ordering service.
• Complete and Mail: Fill out the form with your contractor payment details and mail it to the ATO.

However, electronic lodgement is generally preferred due to its speed and efficiency.

What If You Don’t Need to Lodge a TPAR?

If your business did not pay contractors or issue any grants during the financial year, you might not need to lodge a TPAR. In this case, you should submit a TPAR Non-lodgement advice form. This form allows you to notify the ATO that you are not required to lodge. It also provides confirmation and validation of your status.

Amending a Lodged TPAR

Mistakes happen, and the ATO allows you to correct errors in a lodged TPAR. Amendments can be made using the same method you initially used, whether online or through a tax agent. This is to make sure your records are accurate and up to date.

If you need assistance with lodging your TPAR or have questions about your reporting obligations, contact Retinue at 1800 861 566.