Payment times reporting (PTR) – are you affected?

The payment times reporting (PTR) regime commenced on 1 January 2021 and requires certain large business entities to report on their small business payment terms and times. This information is published on the Payment Times Reports Register and is accessible by the public.

The objectives of this regime are to incentivise large businesses to pay their small business suppliers on time, and to allow small businesses suppliers to make more informed decisions about which large business they will supply.

Who is a reporting entity?

The reporting requirement broadly applies to large businesses that are:

  • constitutionally covered entities (CCE);
  • carry on an enterprise in Australia; and
  • have a total income which exceeds a certain income threshold.

Certain entities are exempt from the PTR, including registered Australian charities and not-for-profits.

Different to consolidation or grouping provisions, PTR reporting obligations are imposed on each reporting entity.

What is a constitutionally covered entity?

A constitutionally covered entity (CCE) is:

  • a constitutional corporation (a trading or financial corporation formed within the limits of the Commonwealth);
  • a foreign entity;
  • a corporate Commonwealth entity or a Commonwealth company within the meaning of the Public Governance, Performance and Accountability Act 2013;
  • an entity, other than a body politic, that carries on an enterprise in a territory;
  • a body corporate incorporated in a territory; or
  • a body corporate registered in a territory under section 119A of the Corporations Act 2001.

CCEs could include private/public companies, trusts, partnerships, joint ventures and sole traders.

Income threshold

A CCE becomes a reporting entity under the PTR Scheme at the start of an income year if it carries on an enterprise in Australia and for its most recent income year (ie the previous completed income year):

  • its total annual income was more than $100 million;
  • for an entity that's a controlling corporation, the combined total income of the members of the controlling corporation’s group was more than $100 million; or
  • for an entity that's a member of a controlling corporation’s group that has a combined income of more than $100 million, the total income for the member was at least $10 million.

Reporting requirements

The entity must report information in relation to the small business invoices payment value, payment days and other relevant information. Some payments are excluded from PTR regime, such as related party payments and some prepaid rental payments.

The reports will be included in the Payments Times Reports Register that is located at the website: https://register.paymenttimes.gov.au  

Reporting period and due dates

Reporting periods are every 6 months of the entity’s financial year for tax purposes. This is either 1 July to 30 June, or the entity’s approved substituted accounting period. PTR reports must be lodged with the PTR Regulator within 3 months of the end of a half-yearly reporting period.

The reporting periods for an entity with a standard 30 June year end or with a 31 December year end the reporting requirements will be:

Reporting Period

Report Due Date

1 January to 30 June

By the immediately following 30 September

1 July to 31 December

By the immediately following 31 March

Late lodgement penalties can be imposed at a daily rate for non-compliance, up to a maximum of $13,320 for individuals and $66,600 for corporations. 

Should you have any queries or require assistance with your lodgements please contact your usual Mazars advisor or alternatively one of our experts via the firm below or on:

Brisbane – Jamie Towers

Melbourne  - Evan Beissel

Sydney – Gaibrielle Cleary

+61 7 3218 3900

+61 3 9252 0800

+61 9922 1166

 

Reference:Payment Times Reporting Scheme, https://paymenttimes.gov.au/

Author: Sophie Chen

Published: 22/03/2023

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