Do you have suppliers who don’t have or provide you with their ABN? In this scenario, you are required to withhold 47% from their payment and send the withheld amount to the ATO.
However, some suppliers are not required to quote an ABN and can use a Statement by a Supplier to justify why payment should not be withheld.
Individuals or businesses can use this form when any of the following apply:
- they are not carrying on an enterprise in Australia
- they are an individual under 18 years and the payment does not exceed $350 per week
- the payment does not exceed $75, excluding any goods and services tax (GST)
- the supply that the payment relates to is wholly input taxed
- they are an individual, and a written statement is provided to the payer to the effect that the supply is either:
- made in the course or furtherance of an activity done as a private recreational pursuit or hobby, or
- wholly of a private or domestic nature
- they are an individual or a partnership without a reasonable expectation of profit or gain
- the whole of the payment is exempt income.
However, if you have reasonable grounds to believe that the statement from your supplier is false or misleading, you are still required to withhold the full 47% from the supplier’s payment.
If your supplier is operating a business or is entitled to register for an ABN, they cannot use the Statement by a Supplier form.