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Tax scheme creates challenge fo...

Tax scheme creates challenge for building sector

Construction companies now have to report to the ATO on all payments made.

Changes to tax laws in the construction sector are creating a challenge that could affect residential building.

Out of fear that certain companies and contractors were avoiding their requirements, the Australian Taxation Office (ATO) has told all construction businesses that they have to report all payments made.

Chief executive officer of Master Builders Australia William Harnisch said: "The obligation to document and report every payment to a contractor is creating a red tape nightmare for contractors and businesses in the building and construction industry."

The extra cost and time spent on reporting payments could add to the issues hindering property building in Australia.

So far this year, the amount of houses approved to be built has only crept up modestly according to Australian Bureau of Statistics (ABS).

This is in spite of high consumer demand, which has raised the suggestion that Australia has a housing shortage and resulted in property prices being driven up.

Posted by Steve Douglas

All information provided is of a general nature only and does not take into account your personal financial circumstances or objectives. Before making a decision on the basis of this material, you need to consider, with or without the assistance of a financial adviser, whether the material is appropriate in light of your individual needs and circumstances. This information does not constitute a recommendation to invest in or take out any of the products or services provided by SMATS Services (Australia) Pty Ltd or Australasian Taxation Services Pty Ltd.

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