Certificate IV in Building and Construction

This article discusses the requirements for becoming a registered builder in Victoria, Australia, different types of business registration, required and recommended insurance policies, different types of taxation required, and responsibilities of an employer to an employee working under an industrial award or enterprise agreement.

Running head: CERTIFICATE IV IN BUILDING AND CONSTRUCTION
Certificate IV in Building and Construction
Name of the Student
Name of the University
Author Note

1CERTIFICATE IV IN BUILDING AND CONSTRUCTION
Table of Contents
1. Requisites for becoming a registered builder in Victoria, Australia:.................................2
2. Required and recommended Insurance Policies:................................................................3
3. Different types of business registration:.............................................................................4
4. Chosen type of business registration:.................................................................................7
5. Different types of taxation required:...................................................................................7
6. Responsibilities of an employer to an employee working under an industrial award or
enterprise agreement:.................................................................................................................8

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1. Requisites for becoming a registered builder in Victoria, Australia:
To become a professional builder in Victoria, Australia one would need the
following essentials:
 One needs a Diploma certificate in Building and Construction.
 A person would be benefitted to have an extensive experience in the construction
industry.
 The person would be required to register himself with the Victorian Building
Authority (VBA).
 He would need a Construction Induction Card (known as White Card) to get access to
a construction site in Australia (Victorian Skills Gateway 2018).
The person is required to register himself with the Victorian Building Authority
(VBA). The VBA:
 Governs a registration system and looks after the ability and conduct of the registered
builders, like building designer, inspector, surveyor, engineer, and others.
 Allows individuals to register, and not companies.
 Accepts application based on qualifications and experience.
 Asks registered builders to carry domestic building insurance for protecting
consumers (Consumer.vic.gov.au 2018).
It is required for a professional builder to be registered with the VIB to:
 Carry out domestic building work, costing over $10,000 which includes materials and
labour.
 Carry out 11 classes of commercial building work.

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 Perform re-stumping, re-blocking, demolition or removal work.Paved the way for
multiple types of building work like painting or plastering, which costs over $10,000.
VBA has the authority to hold disciplinary inquires to evaluate a registered builder’s
conduct and capability. It may be taken up by the VBA on its own discretionary power or if
such is requested by an owner or later. The VBA has the power to grant penalties,
suspensions and cancellation of registration for professional misconduct.
2. Required and recommended Insurance Policies:
The required and recommended insurance policies for the domestic builders
are a legal contract between the insurer and the insured. This terms and conditions set
out in this policy primarily covers the indemnity terms. The insured person would be
indemnified for the damage or loss resulting from any non-completion of work
because of the death, insolvency of the builder. It would also cover those damage or
loss arising out of defective work or any conduct of the builder regarding the work,
which contravenes the provisions of Trade Practice Act; except the insured can
recover compensation from the builder or have the builder rectify the damage or loss
as resulting from the death or insolvency of the builder.
The policy shall also indemnify the insured for the cost of alternative
accommodation, storage or removal costs necessarily and reasonably incurred as a
result of an event which is covered by the policy (Building Regulations 2018).
However, it does not provide storage or accommodation costs for a period of storage
or accommodation which is of delay attributable to the insurer.
The policy should mention the period for which the insured person will be
covered by specifically for the non-structural defects and other causes. It should also
state the amount and its limitation which would be paid in case of indemnity arises.

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No claim shall be entertained unless it is notified within a reasonable period to the
authority about the cause of indemnification.
Recommended and required insurance policy for commercial builders
The commercial building insurance policy should cover the building space for operating
the business and the fixtures and settings (Building Act 1993). It should also cover business
equipment. The insurance policy for commercial builders covers the damage to the buildings
and contents caused by any fire perils or accidental damage. However, it excludes the loss of
income for business interruption. Nevertheless, there may be business interruption insurance
to protect the lost income or take out protection through a business insurance pack including
property, business interruption, stock, theft and money, product and public liability and
others. The commercial building insurance rate is influenced by a number of factors, which
includes size, location, claim rates and claim size, security, stock, business equipment and
others.
3. Different types of business registration:
Types of business registration
There are different types of registration system available for the domestic as well as
commercial builders.
The Commercial builder can apply for the 11 different classes of registration as:
1. Commercial builder that are limited for the purpose of Installation of Blinds
and Awnings Work.
2. Commercial builders, who are limited for the purpose of Erection of Signs
Work

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3. Commercial builders, those who are limited to the Construction of the Low
Rise Building Work.
4. Commercial builders that are limited for the construction of the Medium Rise
Building Works.
5. Commercial builders who are limited for the Non-structural Fit-out work
6. Commercial builders that are limited for the construction of Shade Structure
Work
7. Commercial builders who are limited for the Steel Erection Work.
8. Commercial builders who are limited to the Structural Fit-out Work.
9. Commercial builders that are limited to the Structural Landscaping Work
10. Commercial builders, those who are limited to the waterproofing work, and
the
11. Commercial builders, unlimited.
The person who are willing to be registered as the domestic builder can apply for
registration for a limited, unlimited or domestic builder manager which has been classified
under the building code of Australia.
Unlimited domestic builder can apply for registration for the following classes:
Class 1 that is: a single building which is a detached house, or one or more building
being an attached dwellings, each one being a building, and separated by a wall that is fire
resistant, and includes a terrace house, row house, villa unit or town house (Qbcc.qld.gov.au.
2018). Otherwise, a boarding house, hotel or a guesthouse or the like, having a total area of
floors which does not exceed 300m2, and where the number of person residing is not more
than 12 and which is not located below or above another class of building or dwelling, except
a private garage.

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Class 2 buildings, that are: a building, which contains two or more sole-occupancy
units, and each units being a separate building.
Class 4 buildings referring to a dwelling building which is class 5, 6, 7, 8 or 9 only if
it is the sole dwelling in the entire building and
The associated class 10 buildings, namely a non-heritable building or structure having
a private garage, shed, carport or the same. Which is a structure having a fence, antenna,
mast, swimming pool, retaining or a freestanding wall or the same or a private bushfire
shelter.
The domestic builder (limited) and the domestic builder (manager) would carry out
the domestic building works, which are specified in their certificate of registration
(Ablis.business.gov.au 2018).
Requirements for business registration
The requirements for domestic building registration are that a person needs to be
qualified and experienced for the specific class or component of domestic building work for
which the person seeking to be registered in.
For obtaining a registration as a commercial builder, the person seeking for
registration necessarily have the educational qualifications in a particular class and should
have practical experience for a specified period (Vba.vic.gov.au 2018). He must have also
completed the application form with the details of training and business operation and have
an appropriate insurance.

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Authority to be registered with:
For the purpose of registration, a builder must be registered with the Victorian Building
Authority in Victoria (Consumer.vic.gov.au 2018) and such registration must be confirmed.
4. Chosen type of business registration:
For the purpose of becoming a registered domestic builders unlimited the classes 1, 2,
4 and 10 registration should be appropriate. To become a commercial builder for low to
medium rise buildings, commercial builder limited for construction of Low Rise Building
Work and commercial builder registration for constructing Medium rise Building work
would be appropriate.
5. Different types of taxation required:
The Australian government sets up certain taxes and revenues that a business is
required to pay and administer. They are:
 Company (income) Tax: a resident company of Australia is required to pay company
tax as per the requirements laid down by the Australian Government. A resident and a
non-resident Australian company is taxed at the same rate by the ATO. However,
taxation rate would vary depending on the type of business or industry. Therefore, a
domestic and commercial builder operation a sole proprietorship or a company would
be required to pay Company Tax. It is paid to the ATO (Ato.gov.au 2018).
 Goods and Services Tax (GST): the Goods and Services Tax (GST) is a national
consumer tax having a broad base, imposed on goods and services consumers or sold
in Australia. It is paid to the ATO by registered businesses. A builder or a
construction company dealing with purchase of building materials would be required
to pay GST. A company that has paid GST can file an input tax credit
(Austrade.gov.au 2018).

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 Capital Gains Tax (CGT): this tax is applied on capital gains made from disposing of
assets. It is a part of Income Tax and hence paid to the ATO. CGT is mainly applied
to foreign entities who has acquired and used an asset in the course of his business
based in Australia. Such businesses are recommended to keep a record of the
acquisition of assets, which can be subject to CGT later. Example: if a dwelling is
being built on an already owned land, the land is not exempted from CGT normally,
until it becomes the main residence of the dweller (Ato.gov.au 2018).
These various types of business taxes are administered and collected by the
Australian Taxation Office (ATO).
Additionally, a builder must be aware of taxable payments reporting in which
they are liable to report to the ATO. The ATO must be made aware of the total
amount paid by the businesses in the building and construction industry through the
Taxable payments annual report. It facilitates the ATO to find out the contractors who
have not filed their tax return.
6. Responsibilities of an employer to an employee working under an
industrial award or enterprise agreement:
An enterprise agreement refers to the agreement between a national system employer
and his employee as mentioned in the employment agreement. Through the help of
collective bargaining, enterprise agreements are dealt with in good faith, at the enterprise
strata (Fair Work Ombudsman 2018).
As per the National Employment Standards, an employer is required to provide to its
employee (Business.vic.gov.au 2018):
 The maximum hours of work in a week.

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 Flexible and suitable working hours and arrangements
 Annual leave
 Long paid leave for urgent situations
 Maternity and Paternity leave
 Sick leave and carer’s leave
 Compassionate leave
 Notice of termination
 Compensation for lay-off and retrenchment
The National Employment Standards cover all employees working in the national
workplace relations system, whether under employment contract or registered agreement,
whichever applies (Fair Work Ombudsman 2018).
The employer is responsible to prove a discrimination and sexual harassment free
working environment for the employee. The Victorian Equal Opportunity and Human Rights
Commission observes that the employers meet their legal obligations throughout the various
stages of an employment toward their employees (Humanrightscommission.vic.gov.au 2018).

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References:
Ablis.business.gov.au. (2018). [online] Available at:
https://ablis.business.gov.au/service/vic/registration-of-building-practitioners-domestic-
builder/24314 [Accessed 7 Oct. 2018].
Ato.gov.au. (2018). Building or renovating your home. [online] Available at:
https://www.ato.gov.au/general/capital-gains-tax/your-home-and-other-real-estate/your-main-
residence/building-or-renovating-your-home/ [Accessed 7 Oct. 2018].
Ato.gov.au. (2018). Do you work as a contractor in the building and construction industry.
[online] Available at: https://www.ato.gov.au/general/other-languages/in-detail/information-
in-other-languages/do-you-work-as-a-contractor-in-the-building-and-construction-industry/
[Accessed 7 Oct. 2018].
Austrade.gov.au. (2018). Australian business taxes - Austrade. [online] Available at:
https://www.austrade.gov.au/International/Invest/Guide-to-investing/Running-a-business/
Understanding-Australian-taxes/Australian-business-taxes [Accessed 7 Oct. 2018].
Building Act 1993
Building Regulations 2018
Business.vic.gov.au. (2018). Employee pay rates and conditions. [online] Available at:
http://www.business.vic.gov.au/hiring-and-managing-staff/employer-responsibilities/
australian-minimum-wage-and-awards-national-employment-standards-nes [Accessed 7 Oct.
2018].
Consumer.vic.gov.au. (2018). [online] Available at:
https://www.consumer.vic.gov.au/licensing-and-registration/builders-and-tradespeople/
checklists/becoming-a-registered-building-practitioner [Accessed 7 Oct. 2018].

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Consumer.vic.gov.au. (2018). Becoming a registered building practitioner - checklist.
[online] Available at: https://www.consumer.vic.gov.au/licensing-and-registration/builders-
and-tradespeople/checklists/becoming-a-registered-building-practitioner [Accessed 6 Oct.
2018].
Fair Work Ombudsman. (2018). Welcome to the Fair Work Ombudsman website. [online]
Available at: https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-
sheets/rights-and-obligations/enterprise-bargaining#enterpriseagreement [Accessed 7 Oct.
2018].
Humanrightscommission.vic.gov.au. (2018). Employer responsibilities. [online] Available at:
https://www.humanrightscommission.vic.gov.au/the-workplace/employer-responsibilities
[Accessed 7 Oct. 2018].
Qbcc.qld.gov.au. (2018). [online] Available at: http://www.qbcc.qld.gov.au/building-codes-
australia-bca-classes-buildings [Accessed 7 Oct. 2018].
Vba.vic.gov.au. (2018). [online] Available at:
http://www.vba.vic.gov.au/practitioners/building-registrations/domestic-builder/apply
[Accessed 7 Oct. 2018].
Vba.vic.gov.au. (2018). Building insurance requirements | VBA. [online] Available at:
http://www.vba.vic.gov.au/practitioners/insurance [Accessed 6 Oct. 2018].
Victorian Skills Gateway. (2018). Professional Builder. [online] Available at:
https://www.skills.vic.gov.au/victorianskillsgateway/Students/Pages/
OccupationSearchDescription.aspx?type=occupation&searchid=62 [Accessed 6 Oct. 2018].