From 1 July 2012 if you are a contractor in the building and construction industry, businesses in this industry will have to report to the ATO the total amount they have paid you each year for building and construction services.

The ATO will compare this information with the income you have included in your tax return.

The information to be reported each year by the business that paid you will be:

your Australian business number (ABN)
your name
your address
total amount paid to you including any GST.

Make sure you:

lodge your 2012-13 tax return by the due date and include all your income
lodge any prior years’ tax returns as soon as possible
consider making a voluntary disclosure if you think you have made a mistake in a previously lodged tax return. Where you voluntarily advise the ATO of any errors or omissions, any penalties that apply may be reduced.

If your tax obligations are not up to date or you choose to do nothing, you could be subject to a review or audit and may face penalties.

Do you pay building and construction contractors?
If you pay contractors for building and construction services you will also have reporting requirements.

Australian Taxation Office assistant commissioner John Leonard says these new reporting requirements have been introduced to create a level playing field for businesses and improve tax fairness within the industry.

“Contractors who fail to meet their tax obligations can gain an unfair competitive advantage,” John says.

“We will use the information reported to detect contractors who have not lodged tax returns or failed to include all their income in tax returns lodged.

“We are asking contractors in this industry to make sure they include all their income in their tax return to avoid any penalties.”

You can find out more at http://ato.gov.au/taxablepaymentsreporting