February 07, 2019
Over the past couple of years the legislation about whether a company, as opposed to a sole trader, had to be licensed to be a builder has been confusing. The legislation that commenced in January 2017 made it mandatory for companies to be licensed but a two year transitional period allowed existing companies to continue trading without a building licence.
Late last year the Tasmanian Parliament passed legislation that clarifies the status of building companies. The Tasmanian government has advised HIA that it is not mandatory for a company to hold a building licence provided a director holds a building licence in their own right and signs the building contract. Therefore, it is not necessary for builders who trade using a company to pay for two building licences.
A company may however elect to be licensed. One reason is to allow for the name of the company, and not the individual director’s name, to be on notices, permits, site signage and similar documents. It may also be beneficial where a company takes on more building projects and it becomes difficult for the individual director to monitor each building project. Having the company licensed provides for a clearer way of identifying which entity is accountable for the building work. It should be noted that a licensed building company must always have a director who is a licensed builder in their own right.
If you have any questions about company licensing don’t hesitate to contact a HIA workplace adviser on 1300 650 620.