This User Guide is a continuation of the User Guide: How to set up subcontractors review as part of EOFY Payroll, which provides a comprehensive overview of the different compliance requirements we aim to check as part of the EOFY contractors review. You should read the first review before commencing the Audit Procedures outlined in this User Guide.
1 Check all subcontractors are included in the relevant groups
Run the EOPY - Contractors Group Custom Report Pack
- Go to Reporting > All Reports
- Select the [Custom] Tab
- Run the custom report pack: EOPY - Contractors Group Review
- Click on Export > Excel
- Save the report in the Client's folder > Bookkeeping > FYXXXX > Payroll > EOPY > TPAR
Run the Taxable Payments Annual Reports
- Return to the Reporting Home page and run the Taxable Payments Annual Report for the same Financial Year
è The Taxable Payments Annual Report

- You will need to run this report twice with two separate sets of rules:
- Contact Group: Subcontractors - TPAR - Accounts: All accounts
- Contact Group: Subcontractors - Consultants - Accounts: All accounts
- Click on [Edit Report Rules]
è The Set up rules for your report pop-up screen opens
Option 1 - Subcontractors - TPAR

Option 2 - Subcontractors - Consultants

- Export both versions of the TPAR report to csv
Compare contractor data in MS Excel
- Open both csv export files in Excel
- Select the payee's ABN column
- Press CTRL+H on your keyboard
è The find and replace pop-up opens

- In Find what type a space
- Leave the Replace with field blank
- Click on [Replace All]
è All spaces are removed from the ABN
- With the ABN column still selected, click on [Conditional Formatting] > Highlight Cells Rules > Duplicate Values
è MS Excel conditional formatting

- Make sure there are no duplicate contacts
Note: merge any duplicate contacts back in Xero - Open the Contractors Group Review excel export and delete the GST and Gross columns from both tabs
- Return to the csv exports and copy the Contact Names column across each relevant Tab of the Contractors Group Review
- You can now close off the csv exports
è The Contractor Group Review excel modified report

- Select both columns and click on [Conditional Formatting] > Highlight Cells Rules > Duplicate Values
- When the duplicate values pop-up screen opens change the filter option from Duplicate to Unique

- Any contacts highlighted on the Contact column (from the Contact Group Report) represent all those Xero contacts that have not been added to the relevant group
- Go to Xero and add those contacts to the relevant TPAR or Consultants groups
Before lodging the Taxable Payments Annual Report, a full ABN check should be run for every Subcontractor included in the report for the relevant Financial Year. The ABN check will check if any subcontractor has either changed or cancelled their ABN over the Financial Year or have changed their GST reporting.
2. Check all Subcontractors have all lodgement information
After you added all the contacts in the relevant group, re-run the Taxable Payments Annual Report and ensure all the required contact information is included for each contractor.
Once again, you will need to run the report twice:
- Contact Group: Subcontractors - TPAR - Accounts: All accounts
This report will be used for lodging the actual TPAR, you will need to make sure that no ABN or Address warnings are displayed on the report
è The Taxable Payments Annual Report showing contacts with missing ABN and addresses

All of the missing details will need to corrected to be able to lodge the Taxable Payments Annual Report with the ATO
- Contact Group: Subcontractors - Consultants - Accounts: All accounts
As this report is only used to assess contractors for other compliance requirements, you will need to ensure that any contractors listed in this report do not miss their ABN. Missing addresses are not important for this version of the report.
Export the subcontractor data
After you cleaned up the data of the two reports, re-run both versions of the Taxable Payments Annual Report and export them to csv
- Go to Accounting > Reports
- Run the report: Taxable Payments Annual Report
è The Taxable Payments Annual Report

- Make sure all Subcontractors are included in the Ready for Lodgement section then click on [Export CSV]
- Repeat the same steps for the other version of the Taxable Payments Annual Report
- Open both version of the csv reports in Excel
- Select the payee's ABN column
- Press CTRL+H on your keyboard
è The find and replace pop-up opens

- In Find what type a space
- Leave the Replace with field blank
- Click on [Replace All]
è All spaces are removed from the ABN
- With the ABN column still selected, click on [Conditional Formatting] > Highlight Cells Rules > Duplicate Values
è MS Excel conditional formatting

- Make sure there are no duplicate contacts
Note: merge any duplicate contacts back in Xero - Repeat the above steps for the other version of the report
Prepare the Contractor Audit Tool
- In Dropbox go to Working Papers > Payroll - EOPY & Pay Reviews
- Copy the following working papers:
- WP FYXX EOPY Contractors Audit - Xero
- WP FYXX EOPY Contractors Audit Client - Xero
- Paste the two worksheet in the Client's folder > Bookkeeping > FYXX > Payroll > EOPY > TPAR
- Rename both files accordingly
- Open the WP FYXX EOPY Contractors Audit worksheet
è The Contractors Audit Worksheet

- In the [Cover] sheet, select/Enter the following details:
- Company Name > type the client's business name
- ABN > type the client's ABN
- State/Primary State > Select the client's State/Primary State
- Super check Tolerance Date > Type the oldest date the ABN was last checked
Note:any contractors whose ABN was checked prior to the date entered will be re-assessed for Super - Type of Services > Add/Remove all types of subcontracting services as per the business type
- GL Accounts > Add/Remove all GL expense accounts applicable to both TPAR contractors and Consultants
- Save the worksheet
- Go to the [Xero IM TPAR Report] Tab
- Copy all the columns from the cvs TPAR Export and paste-value CTRL+SHIFT +V all the data into the relevant columns of this worksheet
- After you pasted the data from TPAR worksheet expand/unhide columns A & B of the worksheet and in the Source column select TPAR for all imported rows
è The Xero IM TPAR Report Tab

- Copy all the columns from the cvs Consultants Export and paste-value CTRL+SHIFT +V all the data into the relevant columns of this worksheet
- After you pasted the data from Consultant worksheet expand/unhide columns A & B of the worksheet and in the Source column select Other for all imported rows
- Allocate the correct GL account to each contractor
- Save the worksheet
Check Subcontractors ABNs
- Select the [ABN Lookup] Tab
è All the imported subcontractors' ABNs are listed in this Tab

- Click on [Start Lookup]
è The ABN Lookup pop up screen opens


- Click on [Lookup ABN details]
è The ABN Lookup checks all ABNs against the ASIC database

- Check the following:
- ABN Status > Any Cancelled ABN
- GST Registration > Any No GST Registration and Cancelled GST Registrations
- Save both Worksheets for your record
Check cancelled ABNs
- Go to the ABN Lookup website
- Enter the Cancelled ABN
è The ABN Lookup website

- Check the date the ABN was cancelled
- Go to Xero and check if any Invoices were recorded after the cancellation date
Check cancelled GST Registrations
- Go to the ABN Lookup website
- Enter the ABN with the Cancelled GST
- Click on [Historical Details] Tab
- Scroll down to the Goods & Services Tax (GST)
è The ABN Lookup website

- Check the date the GST Registration was cancelled
Review Tax Rates applied to Non-GST Suppliers (Cancelled or Non-Registered)
- In Xero go to Accounting > Find and Recode
- Click on [Find and recode]
è The Find and Recode Screen

- Click on Add a condition and add the following conditions:
- Contact is > Type the first subcontractor name
- Tax Rate is > Select: GST on Expenses
- Date is after > Type either 30 June of the previous Financial Year (for Contractors whose GST was Cancelled before the Financial Year or for Non-Registered GST Contractors) or the date of the GST Cancellation if the cancellation happened in the Financial Year.
- Click on [Search]
- If the Find and Recode tool returns any results, recode the Tax Rate of the listed transactions to GST Free Expenses
- Repeat the above steps for all Subcontractors flagged in the ABN Look Up worksheet with ABN or GST Registrations Cancelled or Non-Registered for GST