Building and construction industry fact sheet

This fact sheet contains legal, operational and business issues relevant to the building and construction industry, which includes businesses in residential and non-residential construction. It covers services such as building structure, installation, heavy and civil engineering, land development and site preparation.

You may also be interested in our professional services industry fact sheet for information relevant to architects.

As well as the information in this fact sheet, you should check our general business information for additional regulations and obligations relevant to your business, in particular our information for independent contractors. For further advice and assistance, contact your accountant, solicitor or business advisor.

See our topics on this page for detailed information on the building and construction industry, including:

Research

Industry research is an important part of planning for your business. It may uncover economic and industry trends, establish or improve your business and help you keep pace with your industry.

Key government sources for industry specific statistics on the building and construction industry include:

  • Australian Bureau of Statistics (ABS)

    The Building and construction section of the ABS website provides information such as the rate of building approvals, the amount of building work done and the type of work done.

Back to top

Key legislation & initiatives

Legislation often plays a large part in how you run your business, so it’s important to be aware of the laws that apply to your industry. Key legislation that may affect businesses in the construction industry includes:

Back to top

Your obligations

Tax

There are a number of finance and tax measures specific to construction businesses, including:

  • Personal services income (PSI)

    If you’re a consultant or contractor, the income you receive for your skills, knowledge, expertise or efforts may be classified as PSI. The PSI rules may affect what amounts you include in your assessable income, and what deductions you can claim.

  • Taxable payments reporting

    Businesses in the building and construction industry need to report to the Australian Taxation Office (ATO) the total payments they make to each contractor for building and construction services each year.

To find more finance and tax guidance, take a look at:

Back to top

Licences & permits

Licences and permits specific to the construction industry are often managed by state or territory governments and mainly relate to:

  • building licences
  • plumbing licences
  • gas fitting licences
  • electrical licences
  • development applications
  • zoning approvals
  • heavy vehicle licences
  • obtaining a white card
  • water usage or constructing a bore or well
  • connection or work on sewerage/drain
  • carrying out high risk work
  • protecting trees and wildlife
  • fire management and safety
  • use of blasting explosives
  • removal of asbestos
  • use of public land
  • work on heritage properties
  • building energy efficiency
  • disposal of waste
  • handling, storage and use of chemicals or dangerous substances.

Search the Australian Business Licence and Information Service (ABLIS) website to find out what licences and permits you need for your industry.

Back to top

Workplace Health & Safety (WHS)

As well as the general occupational health and safety regulations, there are also some state-specific WHS requirements relevant to the construction industry, including:

Builders who wish to enter into a contract with the Australian Government need to also be accredited under the Australian Government Building and Construction OHS Accreditation Scheme.

Need help understanding your WHS obligations? Try these government resources:

Back to top

Insurance

As well as compulsory insurance such as workers compensation, there are a number of specific insurance options required of businesses in the construction industry.

In most states, builders must be licenced and must obtain specific insurance cover before they can obtain a licence. Insurance requirements often vary depending on your business type and state licensing requirements, but can include:

  • domestic building insurance
  • professional indemnity insurance
  • public liability insurance
  • structural defects/builders' indemnity insurance.

Additional insurance options available to businesses in the building and construction industry include:

  • vehicle and heavy machinery insurance
  • tools, plant and equipment insurance for tradespeople
  • insurance for loss or damage to property in the course of construction.

Find out more about general insurance options for business.

Back to top

Finance

Recovering money owed to you

There are security of payment laws that apply to building and construction contractors in most states and territories. These laws provide a low cost adjudication process to recover money owed to you.

To find information on security of payment laws relevant to your state or territory:

If you're having problems recovering money that is owed to you, find out what to do when you haven't been paid. This information covers:

  • debt collection
  • dispute resolution
  • where to find help and advice
  • legal action.

Back to top

Managing your business debt

If your business is in debt and you want to get your finances back on track, read our information on what to do when you're in debt. It provides steps and advice to help you manage and reduce your debt, including:

  • prioritising your debt
  • how to deal with creditors
  • where to find advice and help.

Back to top

Levies & charges

Levies and charges are largely used to fund activities that benefit the construction industry and its workers, such as improved skills, increased safety and better leave entitlements.

The main levies that apply to the building and construction industry are payable at the state or local government level and vary between states. Some examples of levies in Australia include long service leave levy, industry training levy and industry waste or landfill levies.

Contact your state government department or local council for further information on levies in your state.

Back to top

Protecting your business

Entering into a new business relationship

Starting a new business relationship can be a leap of faith. If you're thinking of engaging with a new client, supplier or contractor, find out how you can protect your business.

Back to top

Preventing unpaid debt

Taking simple steps can help you prevent disputes and unpaid debt by your creditors. Read our information on preventing unpaid debt.

Back to top

Intellectual Property (IP)

As well as trade marks, there are other IP rights that may be relevant to construction businesses:

  • Design protection (e.g. for the design of machinery)

    IP Australia is the federal government agency responsible for granting rights in patents, trade marks and designs. Visit the IP Australia website to find out more about your IP options.

Back to top

Employment & training

Employees

If you employ staff, you need to comply with Australia’s national workplace laws and the specific requirements in your industry:

Back to top

Contractors

The building and construction industry often use contractors to perform specialist skills such as plasterers, concreters, draftspersons, bricklayers, electricians and plumbers. For tax, workers compensation and superannuation purposes it’s important to be clear about whether these specialists are hired as an employee or a contractor. Use our independent contractors decision tool to help you determine the employment status of your workers.

If you want to take on a new contractor, read our information on hiring a new contractor to ensure you don't miss any important steps.

Back to top

Apprentices & trainees

With flexible hours and on the job training, the construction industry lends itself easily to taking on apprentices and trainees. If you take on an apprentice or trainee, you can access a range of government support and financial help. See the Australian Apprenticeships Centre website to find out more.

Back to top

Industry training

Industry training can be an important part of your business survival. New construction methods or safety practices can often help improve your business and save lives. Need some help getting started?

  • Obtain your Construction industry white card
  • Complete asbestos awareness training. If you work in the ACT. From 1 July 2014, all building and construction workers who will be working with asbestos are required to complete asbestos awareness training. For a full list of occupations and your employer obligations, access Worksafe ACT’s Guidance Note on Asbestos Training.
  • If you are a qualified tradesperson and you wish to move interstate, visit the LicenceRecognition website to learn how to transfer your qualifications.
  • See training for tips on providing education and training for your and your staff.
  • Search our events to find government events, seminars, training courses and workshops.

Back to top

Environment

Environmental conditions can often dictate certain aspects of a construction project. Learning how to work within these conditions and also reduce your impacts on the environment can improve your success. Some of the main environmental concerns that businesses in the construction industry should be aware of include:

  • house energy ratings
  • soil contaminated locations
  • areas infected by a species (animal, plant, insect, or disease)
  • flood prone areas
  • bushfire prone areas
  • tree management
  • trade waste management and reduction.

Go to environmental management for detailed information and advice. Search the Australian Business Licence and Information Service (ABLIS) website to find specific licences and permits relevant to these environmental concerns.

Back to top

Advice & help

Your health & wellbeing

Mates in Construction provides suicide prevention training and support to people in the construction industry. If you need advice or someone to talk to, contact Mates in Construction on 1300 642 111 or information@matesinconstruction.org.au.

You can find more organisations that provide information and support to help you with your health and wellbeing on the ATO website.

Back to top

Grants

There are very few grants available for the construction industry, unless you are:

  • employing and training an apprentice or trainee
  • building in a region encouraging growth
  • building structures to support a community activity or event.

Search Grants & Assistance to find grants that may be applicable to the construction industry.

Back to top

Key advisors

Business advisors can be a valuable tool when establishing and developing your business. Search Advisory Services to find one near you.

Back to top

Industry groups

You may also wish to consult with an industry association or group for more information and advice on your industry.

Back to top

Key government organisations & websites

The key federal government agencies and websites relevant to the construction industry include:

The key state government agencies relevant to the construction industry include:

ACT

NSW

NT

QLD

SA

TAS

VIC

WA

Back to top

Other useful information

Information that may be particularly relevant to the construction industry include:

See something not quite right? Let us know on our contact us page.

Back to top

Thanks for your feedback. If you have any ideas on how we can improve, we'd love to hear them.

Please provide your comments in the feedback form.

You might also be interested in