Inland Revenue has announced that tax relief and income assistance are available to people affected by the downturn in business in New Zealand as a result of the outbreak of Coronavirus COVID-19.
They have announced a range of ways to help depending on a person’s circumstances.
While you can’t get an extension for GST or PAYE, you may be able to get relief from late filing penalties when the delay has been brought about as a result of the Coronavirus impact on your business.
You may be able to make an estimate or re-estimate of provisional tax if your circumstances have changed due to the coronavirus. Inland Revenue can arrange early refunds if provisional tax has been overpaid.
If you are having difficulty paying outstanding income tax Inland Revenue may be able to assist by setting up an instalment arrangement. It may also be possible to apply for a write-off due to serious hardship when you know you won’t be able to pay the full amount.
If they grant relief from payment due to hardship and you have losses to carry forward, these losses will be reduced in proportion to the amount written off.
GST and PAYE
Because these taxes are collected on behalf of Inland Revenue and are held in trust by your business, and are therefore not available to be applied in meeting your business obligations, they will not be part of any assistance package. In other words, you will have to meet your New Zealand GST and PAYE (payroll) obligations in full by the due date.
However with regard to other taxes it may be possible to apply for a remission on late filing or late payment penalties or both.
Before you make an application
To be fair, Inland Revenue already had these measures available to them. They have not arisen by new tax legislation. There may already be more attractive options available to you if you are facing challenges to your New Zealand businesses cash flow. For that reason we suggest you contact us for more information and to discuss your particular situation.
Interest charges may still apply on some instalment arrangements so you should always contact us for advice before entering into any arrangement with Inland Revenue. We can often negotiate into an arrangement on your behalf.
You can give us a call on 1300 791 600 for a quick chat.
The information in this article is indicative of NZ tax rules and changes and not intended to be complete for all intents or purposes and does not constitute advice. It is recommended that you obtain professional advice, suited to your particular circumstances, from us before acting on anything you read.