Tax & ATO
Taxable Payments Annual Report
The Taxable Payments Annual Report (TPAR) is an ATO report of the payments a business made to contractors for building and construction, cleaning, courier and road freight, IT, or security services during the financial year. It is due by 28 August each year, and the ATO data-matches it against contractors' own tax returns.
TPAR obligations attach to businesses that pay contractors in the taxable payments reporting system industries. The tests differ slightly by industry.
| Service type | When you must report |
|---|---|
| Building and construction | You operate primarily in building and construction and paid contractors for building and construction services |
| Cleaning | Payments for cleaning services are 10% or more of your GST turnover |
| Courier and road freight | Payments received for courier or road freight services are 10% or more of GST turnover |
| Information technology (IT) | The 10% of GST turnover test applies |
| Security, investigation or surveillance | The 10% of GST turnover test applies |
The system catches mixed businesses more often than people expect: a gym that pays contract cleaners, or a retailer offering courier delivery, can be caught by the 10% tests even though cleaning or delivery is not its trade. Government entities also lodge TPARs for grants and payments for services. The definitive eligibility rules are in the ATO's taxable payments annual report guidance on ato.gov.au.
For each contractor paid during the financial year you report their ABN, name, address, and the gross amount you paid them including GST, plus any GST included in that amount. The details come straight off the contractor's invoices, which is why the practical work of TPAR happens all year, not in August: if every contractor bill in your bookkeeping system carries the supplier's ABN and correct totals, the report is a few clicks; if not, August becomes an archaeology project through a year of invoices.
Some payments are excluded. You do not report payments for materials only, payments to employees (they are covered by Single Touch Payroll), incidental labour, invoices unpaid at 30 June (TPAR reports payments made, not amounts billed), or payments within consolidated groups. Lodgement is electronic: through SBR-enabled accounting software that builds the report from your recorded bills, or through ATO online services for business. Paper lodgement is being phased out and the ATO strongly prefers electronic reports. If you operated in a TPRS industry previously but paid no reportable contractors this year, lodge a non-lodgement advice rather than simply skipping the report, so the ATO does not chase a missing lodgement.
TPAR exists for data matching. Every dollar you report against a contractor's ABN is compared with what that contractor declared on their own tax return and BAS; the shadow-economy gap the system targets is contractors under-declaring cash income. That has two consequences for the businesses lodging. First, accuracy protects your contractors and yourself: a payment reported against the wrong ABN, or a gross amount that double-counts reimbursements, generates ATO please-explain letters at both ends. Second, the ATO actively penalises non-lodgement, and since 2024 has issued failure-to-lodge penalties to thousands of businesses with overdue TPARs, so treating it as optional paperwork is expensive.
A worked example: a small builder pays three subcontractors during 2025-26: a sparky $44,000 (including $4,000 GST), a plasterer $22,000 (including $2,000 GST), and a labourer's business $15,000 with no GST because the labourer is not GST-registered. By 28 August 2026 the builder's TPAR lists each contractor's ABN, name, address, gross amounts of $44,000, $22,000 and $15,000, and GST of $4,000, $2,000 and nil. Nothing extra is payable with the report; it is information only, but it must reconcile with the invoices behind it.
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28 August each year, covering payments made to contractors in the financial year that ended on the previous 30 June. If you were in a reporting industry but paid no reportable contractors, lodge a non-lodgement advice by the same date so the ATO does not record you as overdue.
Invoices for materials only are excluded. Where an invoice mixes labour and materials, you report the whole gross amount paid, including GST. You also exclude wages to employees, incidental labour, and invoices still unpaid at 30 June, because TPAR reports payments actually made during the year.
The cleaning, courier, road freight, IT and security tests look at services you supply to customers, and payments you receive for them, against the 10% of GST turnover threshold, not your industry label. A business that earns part of its income from those services and pays contractors to deliver them can be caught.
Last reviewed and updated: by Bishal Shrestha