Inland Revenue relaxes filing obligations on taxes

Inland Revenue relaxes filing obligations on taxes

Venkat Raman
Auckland, March 28, 2020

Businesses all over New Zealand are feeling the impact of Covid-19 RNZ Picture (clockwise from top) Auckland, Wellington, Christchurch and Dunedin

Inland Revenue Department (IRD) of the New Zealand government has relaxed its regulations around the tax obligations of businesses and self-employed persons registered in New Zealand following the lockdown that came into effect on Thursday, March 26, 2020.

Thousands of businesses – large, medium and small – that are not considered Essential Services have closed down and many of them find it hard to meet their tax obligations such as Tax, GST and PAYE remittances.

An IRD notification said that businesses that are unable to pay their taxes because of the impact of Covid-19 suffered, need not worry.

“If your business is unable to pay its taxes on time due to the impact of COVID-19, we understand, you don’t need to contact us right now. Get in touch with us when you can, and we will write-off any penalties and interest. It would help if you continue to file however, as the information is used to make correct payments to people, and to help the Government continue to respond to what is happening in the economy,” the notification said.

Reprioritised work

IRD said that it has reprioritised its work because of the lockdown, but will continue to provide essential services for businesses and individuals, including Working for Families payments and administration of child support.

“We understand that this is a difficult time, and are doing all that we can to make it as stress-free as possible. We’ll be flexible in the way we approach filing obligations, such as for GST and provisional tax, and tax debt,” the notification said.

Businesses and individuals have been encouraged to contact IRD but online, preferably through myIR on the IRD website.

Income Tax Returns

IRD reminded businesses and individuals to furnish returns as soon as possible. However, any late filing penalties will be waived in these circumstances.

“Late tax return filings will also have the effect of extending the time bar in s 108 to March 31, 2025 (instead of March 31, 2024). Due to the impact of COVID-19 and related potential for filing delays, as at March 31, 2024, the Commissioner of Income Tax will close any review or other compliance activity for any 2018/2019 income tax return which is (a) due on or before March 31, 2020 and is furnished after March 31 but before May 31, 2020 (b) not subject to any existing exclusions from the standard four-year time bar (c) not subject to a dispute (d) commenced by Notice of Proposed Announcement (NOPA) issued before January 1, 2023, and (e) involving alleged tax avoidance, or having tax in dispute of greater than $200 million.

The Commissioner may need to clarify the circumstances of any delay in filing. This is limited to the effects of the COVID-19.

Source: Inland Revenue Department, Wellington, New Zealand

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