Are you in the Building and Construction Industry? Do you pay subcontractors for their services?
If so, you may be required to report to the ATO the total amount paid to your subcontractors in the financial year in which the payments are actually made (ie on a cash basis).
The Taxable Payments Annual Report is due for lodgement by 28 August for the previous financial year.
This information is for data matching purposes, allowing the ATO to identify those contractors who haven't included all their income on their tax return, or not lodged tax returns.
Business are required to ensure that the subcontractor's details (ABN, name and address) are kept up to date and records of payments maintained.
Sub-contractor must ensure they have lodged all tax returns to date and have included all income in those returns otherwise they may be liable for a review or audit or even face penalties.
Note: There is no requirement to provide your subcontractors with any details of the information reported, but you can choose to provide your contractors with details of the information you provided using the Payee information statement.
For more information visit ATO website: http://bit.ly/1RSg6CV or speak to your accountant.