The Morrison government aims to improve payment outcomes for 3.5m SMEs © Rohan Thomson/Getty Images
The Morrison government aims to improve payment outcomes for 3.5m SMEs © Rohan Thomson/Getty Images

Firms offered guidance before new payment law comes into force

Around 4,200 large Australian firms – required under a new law to publicly report payment terms and practices – can register through an online portal.

Registering early in December will provide access to guidance and updates before the Payment Times Reporting Scheme comes into force on 1 January.

The guidance covers which businesses are required to report, information needed in reports, submission instructions, compliance requirements and non-compliance penalties.

The Small Business Identification Tool, which will help identify SME suppliers, will also be available in December, according to the government.

The new rules aim to help SMEs make “more informed choices” by making big businesses' payment terms and performance accessible in public reports.

The first reports on how and when big firms – defined as those earning more than $100m a year – pay SME suppliers will be provided from 1 July 2021. Full reporting capability will be available in the portal in April 2021, according to the government.

Michaelia Cash, minister for employment, skills, small and family business, said: “The objective of the scheme is to improve payment outcomes for Australia’s 3.5 million small businesses by creating transparency around the payment terms and practices of large businesses.”

She added: “The Morrison government has already got its house in order and is paying its bills faster. Commonwealth agencies are paying invoices for contracts under $1 million within 20 days and paying e-invoices within five days.

“Improving payment times for small businesses will help them to prosper, grow and employ more Australians.”

Firms which fail to comply with the rules, including giving no report or fake or misleading information, will receive penalties after a 12-month transition period.

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