How a contractor accountant usually works
We start with a short diagnostic: structure (sole trader, company, trust), GST/BAS status, PSI exposure, payroll and super needs, software setup, ATO deadlines, and cash flow pressure.
Then we move through clear steps:
- Immediate fixes: reconcile bank and payroll, lodge overdue BAS, stabilise ATO position.
- System setup: configure invoicing, time tracking and job costing; automate receipts; set STP Phase 2.
- Compliance rhythm: map quarterly BAS, PAYG instalments, tax planning and year-end.
- Commercial reporting: margin by job/client, utilisation, WIP/progress claims, debtor days.
Australian context to keep in view
- GST threshold is $75,000 GST turnover (taxi and ride‑sourcing must register regardless). Choose cash vs accrual BAS based on how you get paid.
- PSI rules can limit deductions and shift income to you personally. Document tests and set the right workflow early.
- TPAR applies if you pay contractors in selected industries (e.g., building and construction, cleaning, courier/road freight, IT, security). Due 28 August.
- Super and payroll can still apply where a contractor is deemed an employee; STP Phase 2 reporting is mandatory.
- Portable long service schemes may apply in some states and industries. Check obligations alongside workers comp and insurances.
What to compare before you choose a contractor accountant
Scope
Confirm your quote covers BAS, tax returns, PSI assessment, deductions schedule, software setup, STP, TPAR (if relevant) and job/expense tracking.
Software fit
Look for confidence with Xero, MYOB or QuickBooks Online, plus add‑ons for timesheets, job costing and progress claims—explained in workflow terms, not just brand names.
Turnaround and communication
Agree how deadlines are managed during BAS and year‑end peaks, who chases documents, and how urgent ATO matters are escalated.
Commercial fit
Match pricing to your rhythm: fixed fee with clear inclusions, or time and materials. Ensure reporting tracks margin by job and cash flow.
Services a contractor accountant typically provides
- Bookkeeping for contractors: bank feeds, receipts, expense coding, job and WIP tracking.
- BAS and GST: registration, cash/accrual method, quarterly or monthly lodgements.
- Payroll and super: employee vs contractor checks, STP Phase 2, super and leave setup.
- Tax returns and planning: PSI review, deductions, asset write‑offs, PAYG instalment tuning.
- Software: Xero/MYOB/QBO setup, invoicing, time tracking and project/job costing add‑ons.
- ATO and reporting: debt plans, performance dashboards, TPAR preparation and lodgement.
Best next steps
Write a short brief before you call: target outcome, deadlines and software used. Gather last BAS and tax return, ATO account statements, subcontractor list (if any), and access to your file.
Use the links below to move into the most relevant subtopic—bookkeeping, payroll or tax for contractors—then request help when you are ready.
Frequently asked questions
Do contractors need to register for GST?
You generally need to register when your GST turnover reaches or is likely to reach $75,000 in a 12‑month period. Taxi and ride‑sourcing drivers must register regardless of turnover. We confirm your status, choose cash or accrual BAS, and set reminders so lodgements stay on time.
What is Personal Services Income (PSI) and why does it matter?
PSI is income mainly from your personal effort or skills. If PSI applies, some deductions are limited and income may be taxed to you personally even if invoiced through a company or trust. We work through the PSI tests, document results, and configure your payroll and deductions accordingly.
Am I an employee or a contractor for tax and super?
The decision turns on the working arrangement, not just the contract label. Some contractors are employees for super and PAYG withholding. We assess the engagement, set up STP reporting, and ensure super is paid correctly if required.
What can contractors claim?
Typical claims include tools and equipment, protective gear, subscriptions and software, business insurance, training, work vehicle costs (logbook or cents per km), home office and professional fees. Deductions must be substantiated and connected to your income.
Do I need to lodge a Taxable Payments Annual Report (TPAR)?
If you pay contractors in certain industries (e.g., building and construction, cleaning, courier/road freight, IT, security), you may need to lodge a TPAR by 28 August. We help collect ABNs, track payments and lodge on time.
Which software suits contractors best?
Xero, MYOB and QuickBooks Online each work well. The right pick depends on quoting, timesheets, project/job costing, progress claims, payroll and add‑ons. We match the stack to your workflow and set it up for BAS and STP.
How often should I lodge BAS and handle PAYG instalments?
Most contractors lodge quarterly BAS; monthly can help with higher turnover or tighter cash control. PAYG instalments are quarterly by default and can be varied. We tune both to your seasonality and margin profile.