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The table below outlines the steps you should take using a hypothetical example.
A is a plumbing contractor and does not have an ABN. A charges B (a builder) $1000.00 (no GST included) for work done by A for B under a subcontract. B, as the payer, must follow the steps as described in the below table. As no ABN is supplied GST obviously cannot be paid to the contractor.
|What to do||When||Paperwork|
|1st||Write to A – Ask A to either provide his ABN or complete and return the form entitled Statement by a Supplier: Reason for not quoting an ABN.||Before B pays A||Statement by a Supplier – Reason for Not Quoting an ABN - download from the ATO using reference number NAT 3346.|
|2nd||If A has not provided B with his ABN by the due date, B must withhold 47% from A’s payment.||When B pays A||Draft a letter – explaining about why 47% was withheld from the supplier and enclosing both:
|3rd||Include the balance due (the 47%) with the PAYG withheld in the next BAS or IAS statement.||At the end of B’s reporting period||BAS Statement (this is sent to you by the ATO).|
|4th||B should send an annual PAYG summary report to the ATO.||By 31 October the following year||PAYG Annual Report - Not Quoting an ABN - download from the ATO using reference number NAT 3448.|
(Not applicable if Taxable Payments Annual Report made – due by 28 August).
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