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Tracking Taxable Creditor Payments

From July 1 2012, businesses in the building and construction industries that make payments to contractors for building and construction services must report those payments to the Australian Tax Office (ATO) on the Taxable payments annual report. This is an annual report providing details of taxable payments for building and construction related activity.

You can track construction industry taxable payments (CITP) in Exo Business, which helps you complete this report. For more information on taxable payments, refer to the ATO website.

Setting Up

To enable the features for taxable payments, select the Track Taxable Payments to suppliers for building and construction related activity Company-level profile setting.

All Creditors whose payments you must track should have an Australian Business Number (ABN) recorded.

If you plan to submit the Taxable Payments Return to the ATO electronically, you must set up addresses in Exo Business Configurator under System > Display Names. Exo Business uses the Purpose property of address Display Names to determine which details to include. For example, whichever address field has been given the Street property populates the street detail for all accounts included in the return. Before you can generate the return, you must assign purposes to the address details.

You can assign each purpose only once. For example, once you have assigned the Street purpose to one address field, Street is not available in the Purpose dropdown for any other address fields. Assign all purposes to an address field.

Note: You should assign purposes to the Delivery Address fields, such as. DELADDR1 - DELADDR6, rather than the Postal Address fields.

Once each purpose has been assigned to an address field, you can review your company’s address details in Exo Business Configurator at Company > Company Details, and Creditors’ address details on the Details 1 tab of the Creditor Account Details window to ensure that the correct data has been entered into all fields.

Tracking Creditors

When CITP features are enabled, you can select the Track Taxable Payments option on the Details 2 tab of the Creditor Account Details window. All payments from the Creditor are tracked for reporting on the Taxable payments annual report.

Tracking Payments

When entering Creditor Payments, if the selected account has its Track Construction Payments option enabled, you can enable or disable the Taxable payment option on the Creditor Payment Entry window to include or exclude payments from tracking.

Note: Access to the Edit Ref Fields option is controlled by the Permitted level of access to creditor transaction editing profile setting.

Reporting on Taxable Payments

Report on Taxable Payments using the Taxable Payments Reporting Worksheet menu item. When added to a menu in the Exo Business core module, this item opens a window in which you can review taxable payments for Creditors and generate the Taxable Payments Annual Report (TPAR):

Initially, the worksheet displays all Creditors whose Track Construction Payments option is enabled. The period selected is the current year. To specify a different year or a specific period/date range to include in you report, select it using the Filter Criteria controls, then click Search. Double-clicking on a Creditor opens the Creditor Account Details window.

Selecting the Show Payments options displays all payments for the selected Creditor in the lower part of the window. Payments that are marked as non-taxable are highlighted purple. You don't need to report on all payments to a tracked creditor. For example, if the payments are for materials only (such as building supplies and materials), you can exclude these payments when you enter the payment or on this worksheet.

Double-click on a payment or select it and press SPACE to toggle its taxable status. This also updates the totals in the grid above. You can also right-click on a payment to view the payment’s allocation details and to edit it in the Edit Transaction Reference window (if the Edit Ref Fields option is available).

Select one of these options from the Print dropdown:

  • Taxable Payments Return - this report displays, for each Creditor over the selected year or period/date range, the information that you must enter on the Taxable payments annual report.
  • Taxable Payments Details - this report display the details of all taxable payments for the selected Creditor over the selected year or period/date range.

Selecting the Include payments to suppliers where an ABN wasn’t quoted option includes payments for which taxes were withheld or retained and paid to the ATO on the suppliers’ behalf. This is enabled by selecting the  Withholding Tax on Creditor Payments setting in the Essential > General Settings section of the Exo Business Configurator. A Creditor can begin the reporting year without an ABN, and then supply an ABN later when trading within the same tax year.

Note: If an error message stating that the lodgement can't be submitted because the reporting party's contact information is missing, you must enter the System Administrator Details in the Essential > Implementation Notes section of the Exo Business Configurator.

Sending the Taxable Payments Report Electronically

As well as printing a Taxable Payments Return, you can send the return to the ATO from the Taxable Payments Reporting Worksheet window using Standard Business Reporting (SBR). To do this, you need:

  • A my.MYOB account – your Business Partner must contact MYOB's administration team with your details to sign you up for an account.
  • A Business Reference Number (BRN), which uniquely identifies an Exo Business database. Contact your Business Partner for the BRN for your database (they are given it after your my.MYOB account is created). Once you have a BRN, enter it in the Business Reference Number field in the Company > Company Details section of Exo Business Configurator.
  • A software ID – this is generated in Exo Business Configurator at Business Essentials > SBR. Click the Request Software ID button to generate the software ID (the ID is based on your BRN).

Note: If you are already using the Bank Feeds feature, you have a my.MYOB account and BRN. You do not need to apply for them again.

Click the SBR button (  ) to open a confirmation window that displays the details of all payments to submit.

Validation errors display in the confirmation window. Correct the errors before submitting the report. You can double-click on an error to go to the related Creditor account.

If there are no errors, click Submit to submit the report to the ATO. You must enter your my.MYOB account details.

A confirmation message appears once the report has been submitted. You can check the progress of your submission on the SBR Manager window, which you can open by clicking the   toolbar button on the NZ GST Return window.

Note: You can re-submit a report if necessary; records that have already been submitted are overwritten.