Do construction (residential and commercial) businesses need to obtain Subcontractor's Statements before paying subcontractors (NSW)?

Obtain Subcontractor's Statements before paying subcontractors (NSW). In New South Wales, a principal contractor can be made liable for a subcontractor's unpaid workers compensation premiums, payroll tax and employee remuneration for work done under the contract. Three laws create that exposure: section 175B of the Workers Compensation Act 1987, Schedule 2 Part 5 of the Payroll Tax Act 2007 and section 127 of the Industrial Relations Act 1996.

Trigger: Engaging a subcontractor who employs or engages workers to perform the contract work, and each payment claim made under that contract.

Rules Mate runs its applicability engine across 9 business structures and 6 size bands for each of the 35 industries it maps. For 34 of those industries the answer for "Obtain Subcontractor's Statements before paying subcontractors (NSW)" is no. Construction (residential & commercial) is one of the 1 where the answer is different: only if.

The deciding fact for construction (residential and commercial) businesses: Industry: Construction (residential & commercial) · Operates in NSW, QLD; applies only if you are a principal contractor engaging subcontractors.

About the industry: Builders, contractors, and subcontractors covered by the Building & Construction General On-site Award and high-risk WHS.

Compare a professional services (general) business with 6–19 employees structured as a Pty Ltd company: the obligation does not apply (Requires a trigger outside this questionnaire).

Each cell is the engine's outcome for a business in construction (residential & commercial) with that structure and size, assuming it sells to consumers and small businesses and holds customer contact details. "Check" means the obligation turns on a fact the industry does not settle.

When due

Obtain a statement for each payment claim period. Each statement must state the period it covers, and sequential statements should give continuous coverage of the contract.

Evidence to keep

Signed Subcontractor's Statement for every period, showing the contract identifier and the date of the payment claim; attached certificate of currency for the subcontractor's workers compensation insurance; copies of statements obtained from sub-subcontractors; retention of statements for the periods set by each Act (currently up to seven years).

Maximum penalty

Without a valid statement the principal contractor may be liable for the subcontractor's unpaid workers compensation premiums, payroll tax and remuneration. A subcontractor, or a person signing on its behalf, who gives a statement knowing it to be false commits an offence under each of the three Acts

Regulator

Revenue NSW

Jurisdiction

NSW only

• Building work — comply with National Construction Code (NCC): Yes
• Domestic Building Contracts Act 1995 (Vic) — warranties: Only if
• Home Building Compensation Fund (NSW): Only if
• Asbestos management — workplace + dwelling rules (state): Yes
• Comply with NSW Design and Building Practitioners Act 2020: Only if
• Comply with the respirable crystalline silica workplace exposure limit (0.05 mg/m³): Yes
• All 31 answers for construction (residential & commercial)