Construction Industry
Construction accounting including progress claims, retention amounts, GST reporting, and building industry compliance.
Construction Industry Accounting
Specialist accounting for the building and construction industry, covering ATO requirements for progress claims, retention amounts, and GST obligations.
Progress Claims and Revenue Recognition
Under ATO rules (TR 2018/3), the basic approach for construction contracts is:
- All progress and final payments received in a year must be included in assessable income
- Income tax deductions are allowed for losses and outgoings to the extent permitted
- GST must be reported on the full taxable value of your progress claim in the period you issue the invoice
- You must pay GST regardless of whether the recipient has actually paid the claim
Retention Amounts
Under ATO ruling GSTR 2000/29:
- Retention amounts form part of the consideration for a taxable supply when the progress claim arises
- GST is payable on the full amount of the progress claim, including retained amounts
- When retention is eventually released, no additional GST applies (it was already accounted for)
Construction-Specific Accounting Services
- Progress Claim Tracking: Manage invoicing schedules and track claimed vs received payments
- Work-in-Progress (WIP): Accurate reporting of incomplete contracts and revenue
- Job Costing: Track costs by project, trade, and cost centre for profitability analysis
- Subcontractor Management: Track payments, verify ABNs, and manage PAYG withholding
- Security of Payment: Support with statutory payment claim processes
- Plant and Equipment: Depreciation schedules for machinery and equipment
- Contract Assessment: Fixed-price vs cost-plus contract analysis
Industry Obligations
- Long service leave portability scheme registration (state-based)
- Construction industry training fund levies
- WorkCover and workers compensation premiums
- Building industry compliance and licensing requirements
- Home warranty insurance (residential builders)