Accountants for Construction Companies

A building company should treat each progress payment as its own supply for GST. On a cash basis, GST is due when the client pays; on an accruals basis, it is due when you issue the progress claim or invoice, even if payment hasn’t arrived. Either way, set the GST aside from every payment as it lands, and structure invoices so retentions don’t trigger GST before you’ve been paid.

Most established builders and construction companies in NSW trade through a Pty Ltd company, often with a discretionary trust holding the shares and with plant, equipment or property held in a separate entity. The construction specific factor is that your contractor licence and your Home Building Compensation Fund eligibility both attach to the trading entity, so that entity’s balance sheet has to stay strong enough to support the work you want to win. That constraint usually rules out the profit stripping approach that works in other industries.

Construction companies need a specialist accountant because the industry’s cash flow patterns, contract accounting, and compliance environment are materially different from a typical small business. Progress payments, retention monies, work-in-progress accounting, subcontractor management, and Home Building Act licensing all require treatment that general accountants often handle poorly. A specialist understands how these interact across a