A Contractor’s Guide to Getting Tax-Ready Before the EOFY
When you’re juggling client deadlines, invoicing and project delivery, it’s easy for your tax affairs to become an afterthought until they can’t be.
Staying compliant isn’t always straightforward for contractors either. Your engagement structure – whether PAYG or company – directly shapes your obligations, your reporting requirements and ultimately, how much tax you pay.
Getting it right takes planning. Getting it wrong can be costly.
Here’s what you need to know to be tax ready.
The reality of contractor compliance
Contracting offers flexibility and an earning potential that permanent employment can rarely match. But that flexibility comes with greater responsibility for managing your own tax position.
If you're new to contracting, it helps to understand the two most common engagement structures:
PAYG (Pay As You Go) – you're engaged as an employee by Resolve. Tax is withheld from each payment and your obligations to the ATO are managed for you, by us
Pty Ltd (Proprietary Limited) – you operate through your own registered company. You are responsible for your own tax, GST and superannuation contributions
This article focuses specifically on contractors operating through a Pty Ltd entity. If that’s you, here’s an overview of what you would typically be responsible for:
PAYG withholding – if you employ others or draw a wage from your company
PAYG instalments – prepayments toward your expected tax liability (if applicable, based on your ATO-assigned instalment obligation)
Instalment Activity Statement (IAS) lodgements – frequency depends on your withholding and instalment obligations (commonly monthly)
Business Activity Statement (BAS) lodgements – required where registered for GST (mandatory once annual turnover exceeds $75,000) and typically lodged quarterly, though some entities report monthly or annually
Superannuation obligations – for yourself (where you draw a wage) and any employees
Year-end financial statements, company tax returns and individual tax returns
Because tax isn't automatically withheld for contractors working through their own entity, a strong financial year can quickly turn into a surprise tax bill at year-end – especially without proactive planning.
The real cost of getting it wrong
Most contractors focus on delivering results for their clients. Tax compliance often becomes a secondary consideration – until EOFY arrives and the pressure hits.
Without proactive planning and the right support, the consequences can include:
Unexpected tax liabilities due to insufficient PAYG or cash flow set-asides
ATO penalties and interest for late lodgements, incorrect reporting or underpaid instalments
Disallowed or unsubstantiated deductions where records are incomplete or claims fall outside the rules
Increased administrative burden spent reconciling a full year of records under time pressure
Missed opportunities to legitimately minimise tax through structuring, super contributions or timing of expenses
Compliance is not just administrative housekeeping – it’s financial risk management. When you have the right people supporting you throughout the year and not just at tax time, these consequences are easily avoidable.
A smarter model for contractors
Most recruiters place you and move on. But for us, placing you is just the beginning.
When your recruiter, payroll team and tax adviser operate as one, nothing falls through the cracks. We understand your circumstances from the moment your engagement begins through to your tax return - and that complete picture means you can make better-informed decisions throughout your contracting career.
Through our partner firm, Resolve Advisory – a Chartered Accounting practice and Registered Tax Agent – we deliver a model that integrates:
Recruitment and engagement – sourcing, placement and onboarding
Payroll management – accurate, compliant payroll across PAYG and contractor arrangements
Tax compliance and lodgement – BAS, IAS, individual, company and trust tax returns and year-end reporting
Tax planning and structuring – advice on entity setup, compliance and structuring to suit your engagement and income profile
Business advisory – cash flow planning, budgeting and financial management to support sustainable contracting
Superannuation strategy – tax-effective contribution planning and Self-Managed Super Fund (SMSF) support to optimise both your tax position and long-term retirement outcomes
Bookkeeping and management reporting – clean books and clear numbers, month-to-month
ASIC and corporate secretarial – ongoing company compliance, annual reviews and statutory obligations
All through a single, coordinated team.
Most contractors manage three separate relationships just to stay compliant - their recruiter, their payroll provider and their accountant. We bring all of it under one roof – ensuring a seamless, consistent experience across every stage of your engagement. No gaps and no repeated conversations.
Integrated Payroll and Tax Support
Being engaged through Resolve also means your financial and tax obligations are handled from day one - not left for you to figure out across multiple parties. These benefits are a distinct advantage of being a Resolve contractor – often reserved for permanent employees.
Equipped with our Integrated Payroll and Tax Support, you can expect:
End-to-end recruitment and payroll management
Complimentary individual tax return preparation
Direct access to Chartered Accountants and Registered Tax Agents
Personalised compliance, structuring and tax planning advice
Extended lodgement timeframes available through a registered tax agent
A complimentary annual financial planning session through our partnership with Argent Street – covering wealth creation, superannuation, cash flow, insurance and estate planning, available to you and your family
The result is a cleaner, simpler experience - where your recruiter, payroll and accounting teams are all working from the same page, all year round. Because while staying compliant can be complex, managing it doesn’t have to be.
The Resolve Recruit difference
We're one of the few recruiters who understand contracting from every angle – as recruiters specialising in contract placements, as contractors ourselves and as accountants experienced in managing the financial side.
That firsthand experience across all three areas is what makes the real difference.
Do not leave it until 30 June
Preparing for tax time as a contractor doesn’t need to be complex nor stressful, but it does need to start early.
With the right structure and support in place now, you’ll be able to meet your obligations with ease and avoid the cost of last-minute decisions.
Get In Touch
Contact our team today to learn more about how Resolve can support you - from understanding your tax position to putting the right structure in place for the year ahead.
