Bookkeeper for Builders in Geelong, Job Costing, Payroll and BAS

Why Building Businesses Have Unique Bookkeeping Needs

Geelong's construction sector is busy. From residential builds in Armstrong Creek and Torquay to commercial fitouts in the CBD, builders across the region are managing multiple projects, subcontractor relationships, progress payments and ATO obligations, often all at the same time.

The problem is that most standard bookkeeping setups are designed for businesses with one revenue stream and predictable costs. Construction doesn't work like that. Costs spike when concrete arrives, income is tied to progress milestones, workers might be on different awards, and your BAS can swing wildly from one quarter to the next depending on which jobs settled.

A bookkeeper who understands the construction industry, not just accounting software, makes a real difference. Below, we break down the three areas that matter most: job costing, payroll compliance and BAS lodgement.

Job Costing: Knowing What Each Project Actually Costs You

Job costing is the process of assigning every cost, labour, materials, plant hire, subcontractors, site overheads, to a specific project so you can measure its actual profit margin.

Without job costing, you might finish a job feeling like it went well, only to discover at year end that you broke even or worse. Many Geelong builders who come to us have been running their books at a single-entity level: total revenue, total expenses, one P&L. That tells you almost nothing about which projects are worth repeating and which are eroding your business.

Under ITAA 1997, you're required to keep adequate records that support your income and expense claims. Project-level records are the clearest way to meet this obligation and to defend deductions if the ATO ever asks questions.

In Xero, job costing is handled through:

• Xero Projects, lets you log time, expenses and invoices against a specific project and see a real-time margin report
• Tracking Categories, lets you tag transactions to a job or cost centre in your standard Xero file and pull a P&L by job from your reports

Either approach works well depending on your volume of jobs and level of detail required. True Tally can assess your workflow and configure the right setup for your business.

The key job cost categories builders need to track consistently include:

• Direct labour (employees on-site)
• Subcontractor payments (also relevant for TPAR, more on that below)
• Materials and supplies
• Plant and equipment hire
• Site-specific overheads (skip bins, temporary fencing, site insurance)

Once these are allocated correctly, you can generate a job profitability report in Xero at any point during a project, not just when it's finished. That means you can identify a cost blowout in week three and make decisions before you're locked in.

Payroll in Construction: Awards, Allowances and Superannuation

Construction payroll is not simple. Workers in the building industry are typically covered by the Building and Construction General On-site Award 2020 (MA000020), which includes a range of allowances on top of base pay. Getting these wrong exposes you to back-payment claims under the Fair Work Act 2009 (Cth).

Common allowances under MA000020 that builders often miss or miscalculate include:

• Tool allowance, payable to carpenters, concreters and other trades who supply their own tools
• Travel allowance, for workers required to travel to sites beyond a defined distance
• Height allowance, for work performed above a specified height
• Wet weather allowance, when workers are required to work in adverse conditions
• Shift and overtime penalties, which differ depending on whether Saturday, Sunday or public holiday work is involved

These allowances must be calculated correctly for each pay period. The Fair Work Commission updates minimum pay rates each July, so your payroll setup needs to be reviewed annually. You can check the current rates at fairwork.gov.au.

Superannuation is a separate obligation. Under the Superannuation Guarantee (Administration) Act 1992 (Cth), builders must pay super at the legislated rate, 11.5% for 2024–25, rising to 12% from 1 July 2025, for all eligible employees. Super must be paid to the employee's nominated fund (or a stapled super fund if no nomination is provided) and lodged by the quarterly super due dates. Late super triggers a Superannuation Guarantee Charge (SGC), which is non-deductible and includes interest and an administration levy.

In Xero Payroll, allowances under MA000020 can be configured as pay items so they calculate automatically each pay run. True Tally sets up these pay items correctly from the start, which saves significant time and reduces the risk of underpayments that could result in a Fair Work audit.

Taxable Payments Annual Report (TPAR): A Must for Builders

If your business operates in the building and construction industry and you pay contractors for building and construction services, you must lodge a Taxable Payments Annual Report (TPAR) with the ATO each year by 28 August.

The TPAR is governed by Schedule 1, Division 405 of the Taxation Administration Act 1953. It requires you to report the ABN, name, address and total gross payments (including GST) made to each contractor during the financial year.

The ATO uses TPAR data to cross-check that contractors are declaring income. Failing to lodge on time can result in penalties, and the ATO actively pursues non-lodgement in the construction sector.

In Xero, TPAR data can be extracted directly from the accounts payable section, provided contractors have been correctly set up as suppliers with their ABN recorded. True Tally reviews your supplier list, confirms ABNs are captured, and prepares your TPAR for lodgement so nothing is missed.

BAS Lodgement for Builders: GST, Withholding and Progress Invoicing

BAS lodgement for builders involves more complexity than most industries. The main considerations are:

• GST on progress invoices, each progress invoice must include GST, and you account for GST collected on your BAS in the period it's invoiced (on an accruals basis) or received (on a cash basis). Most builders on accruals should be invoicing with GST included on every claim
• GST withholding on new residential premises, under s 14-250 of the Taxation Administration Act 1953, purchasers of new residential premises are required to withhold a portion of the GST from settlement and remit it directly to the ATO. If you're building and selling new homes, your conveyancer and accountant need to be across this, and your bookkeeping needs to reflect the net amount you receive
• PAYG withholding, if you have employees, PAYG withholding from wages must be remitted on your BAS each period
• PAYG instalments, if you're a sole trader or company with a history of tax liability, the ATO may require you to pay PAYG instalments, which appear on your BAS

Lodgement deadlines are typically 28 days after the end of each quarter, or the 21st of the following month for monthly lodgers. Registered BAS Agents like True Tally have extended due dates, which gives your business more time to prepare accurate figures before submission.

Before every BAS lodgement, True Tally performs a reconciliation of your Xero accounts: bank reconciliation, GST audit, payroll reconciliation and a check of outstanding invoices. This means the figures we lodge match your actual financial position, not just what's in the system.

Common Mistakes Geelong Builders Make With Their Books

After working with construction businesses across Geelong and regional Victoria, these are the mistakes we see most often:

• Not separating personal and business expenses, using the business account for personal purchases creates a reconciliation nightmare and inflates your apparent expenses
• Paying subcontractors in cash without records, this creates TPAR problems and means you can't substantiate the deduction under ITAA 1997
• Coding all costs to one expense account, "Subcontractors" and "Materials" should always be separate accounts, and ideally split by job
• Forgetting to pay super on allowances, ordinary time earnings (OTE) for super purposes can include some allowances under the SGA Act; getting this wrong results in an SGC liability
• Lodging BAS without reconciling first, lodging figures that don't match your bank means you'll either over- or underpay GST, and corrections require amendment lodgements
• Not reviewing job margins until the end of the year, by then, nothing can be done about a job that ran over budget six months ago

What to Do Next

If you're a builder in Geelong and your books are behind, your BAS is stressing you out, or you have no idea which jobs made money last quarter, here's a simple starting point:

1. Book a free 20-minute call with True Tally, we'll ask a few questions about your current setup and tell you exactly what needs fixing
2. We'll review your Xero file (or set one up if you're not on Xero yet) and identify gaps in job tracking, payroll setup and GST coding
3. We'll establish a monthly bookkeeping routine, bank reconciliation, payroll processing, TPAR tracking and BAS preparation, so you're never scrambling at lodgement time

Construction is a tough industry on margins. The last thing you need is avoidable ATO penalties, underpayment claims, or a year-end tax bill that blindsides you. A bookkeeper who knows building can keep your finances as solid as your builds.