Disallowed Deductions and TPAR - 2019


From the 1 July 2019 income tax deductions will not be allowed for certain payments if the required withholding obligations are not complied with.

Deductions will not be allowed for the following payments if the required withholding has not been complied with.

1.Employee payments such as salary, allowances, commissions, etc.

2.Payments made to directors for services rendered.

3.Payments to contractors who have not quoted their ABN.

However, deductions will not be denied under the following circumstances:

1.Where an incorrect amount has been withheld.

2.Where employers make a payment to an employee, they consider to be a contractor and have obtained the ABN from the contractor.


Businesses that provide courier or cleaning services will from the 1 July 2018 also need to lodge taxable payments annual reports

Suppliers of courier or cleaning services must report any payments made to contractors if:

1.The supplier has provided them with an ABN.

2.The supplier has provided the service on their behalf and

3.No reporting exemption applies to them.

The definition of courier service is quite broad and encompasses the delivery or collection of items or goods anywhere in Australia but excludes passenger transport services or freight transport.

By the same token the definition of cleaning services is also very broad and includes road and street cleaning, park facilities cleaning, swimming pool cleaning gutter cleaning, carpet and gutter cleaning and most forms of interior and exterior cleaning.

Remember payments for materials only and not paid by year end do not need to be reported – nor do payments to employees and payments for private or domestic reasons.

Entities whose payments received for cleaning or courier services are less than 10% of their GST turnover will not be required to lodge this report.

Should you want to discuss this further please feel free to give me a call.

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