Prescribed payments requirement

Can someone explain to me what this refers to and is it necessary?


The owner builder must register with the tax office
as an owner builder under the
'prescribed payments'
system. The prescribed rate of tax is deducted by the
owner builder from all payments made to contractors
or subcontractors. This is sent with the relevant form
to your local tax office. A booklet on the
'prescribed
payments' system is also available from the tax
office.