The Report That Catches Out Businesses Who Pay Subbies
If you run a building or construction business and you pay contractors, you almost certainly have to lodge a Taxable Payments Annual Report. It is due on 28 August each year, and the businesses that struggle with it are not the ones who forget the date. They are the ones who did not capture contractor details through the year.
The Short Version
Three things decide whether TPAR is a quiet afternoon in August or a scramble through a year of records.
- Due 28 August. Each year, covering the financial year that ended on 30 June.
- The 50 per cent test. Income or activity, and the prior year can pull you back in.
- Capture ABNs upfront. The report is only as good as the records behind it.
What a TPAR Actually Is
A Taxable Payments Annual Report tells the ATO what you paid contractors during the financial year. The ATO uses it to check that the contractors you paid have declared that income themselves. It is a reporting obligation, not a tax. Lodging one does not cost you anything beyond the work of preparing it. The report lodged by 28 August 2026 covers the financial year from 1 July 2025 to 30 June 2026.
Do You Have to Lodge One?
For building and construction, the test is about how much of your business is building and construction services. According to the ATO, you are treated as primarily operating in building and construction services if any of the following are true: 50 per cent or more of your business income for the year came from building and construction services, or 50 per cent or more of your business activity related to building and construction services, or 50 per cent or more of your business income in the financial year immediately before the current one came from building and construction services. If you meet that test and you paid contractors or subcontractors for building and construction services, you need to lodge. Two things trip people up here. The first is that the test can be met on activity rather than income, so a quiet year does not necessarily take you out of it. The second is that the prior year test can pull you back in even when the current year would not.
What Has to Be Reported
For each contractor you paid, the report captures who they are and what you paid them. In practice that means their ABN, their name and address, and the gross amount you paid them for the year including GST. Payments for materials only are treated differently to payments that include labour. This is why TPAR is really a bookkeeping problem rather than an August problem. If contractor ABNs were never captured, or payments were coded to a general expense account without identifying who was paid, the information simply is not there in August. Reconstructing it from bank statements and invoices is slow, and it is the single most common reason a TPAR is late.
How to Make August Uneventful
The businesses that find TPAR easy do three things through the year. They collect the ABN before the first payment, not after the last one. They set contractors up properly in their accounting file so payments are attached to a supplier record rather than a general code. And they check the ABN is valid and that the contractor is registered for GST if they are charging it. Done that way, the report is generated rather than assembled. Done any other way, August is a scramble.
How Navigata365 Handles TPAR
For building and construction clients, the report is part of the annual cycle rather than a separate job.
We prepare and lodge TPAR.
For building and construction clients across Melbourne, as part of the annual cycle.
We fix the records first.
If contractor details were never captured, we rebuild them before August, not during it.
Common Questions
Do you report payments to contractors who only supplied materials?
Materials only payments are treated differently to payments that include labour. Because the distinction matters and depends on what was actually supplied, this is worth confirming against your specific arrangements rather than assuming, and we check it as part of preparing the report.
What if a contractor did not give you their ABN?
You still need to report the payment. The absence of an ABN also has withholding consequences at the time of payment, which is why collecting it upfront matters more than chasing it later.
Do you lodge if you paid contractors but are not primarily building and construction?
Other industries have their own TPAR obligations with different tests. Building and construction is only one of the categories the report covers, so not being a builder does not automatically mean you are exempt.
What happens if you lodge late?
Late lodgement can attract penalties. More practically, a late TPAR tends to be a symptom that contractor records were not maintained through the year, which usually means the underlying numbers need work too.
Does your accountant do this, or your bookkeeper?
It depends on your arrangement. Because the report is built from the contractor payment records that sit in your bookkeeping file, it is usually more efficient for whoever maintains those records to prepare it. We lodge TPAR for our building and construction clients as part of the annual cycle.
Where to Confirm the Detail
The rules described here come from the ATO’s own published guidance and were checked in August 2026. Reporting requirements do change, so confirm the current position with the ATO or with us before relying on it for your own lodgement.
What our clients say
Verified reviews from our Google Business Profile.
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Best decision ever !! I stopped spending time on paperwork ... gave it all to Fiona .. and now I can concentrate on growing my business. Thanks so much to Fiona and her team I can spend more time with Family & Friends :) and run a paperless business :)
Glenn Adams11 months ago -
Engaging the services of Fiona and her team at Navigata365 at the beginning of COVID was the best thing we could have done. Fiona has guided our 2 businesses through some really tough times and has recently helped us set up a 3rd business. She is always on top of deadlines and we never have to worry about a thing. I cannot recommend highly enough.
Sharon Knott2 years ago -
It is a great pleasure to provide a review of Fiona Battersby and her business Navigata365. We have worked together for approx 5 years and during that time our bookkeeping has been carried out brilliantly. We have benefited from very good advice from Fiona about managing our accounts. It is rare to get a bookkeeping business with the level of service and competence that Fionas staff consistently provide. A big thumbs up from Us!!
Martin Speller2 years ago -
Nothing but great things to say about Fiona and team, first time business owner here and Fiona and team are brilliant to work with I really feel like she has my best interests at heart.. cannot recommend enough super team … here is to many many more years together
Shaun Oneill2 years ago -
Fiona and her team got me out of a really tight spot with some ATO obligations I was fumbling around with in a timely and super professional manner. They explained everything to me so I don't screw it up again. Thank you team :)
Tracy Koppa year ago
