New Zealand’s Inland Revenue starts next phase of business transformation

The next phase of the New Zealand Inland Revenue’s business transformation programme will roll out in April.

Enabling legislation introduced last year is designed to simplify tax processes and integrate them with day-to-day business activities. A new option for managing provisional tax through Accounting Income Method (AIM) software is also to become available from the start of the new tax year, according to the Inland Revenue Business Transformation bulletin.

The AIM system is designed to simplify the payment of provisional tax for small businesses by enabling them to match their payments to their actual cashflow using accounting software.

But proposals for the Payday Reporting of PAYE information are also in the pipeline. If the legislation is enacted, the regulations would be voluntary until April 2019. Under the terms of the suggested rules, employers would be required to submit PAYE information every payday instead of monthly and would be able to file returns directly from their payroll software.

From April, it will also be mandatory for financial institutions to report some financial account information about foreign tax residents to the Inland Revenue on an annual basis.

Since 1 July 2017, financial institutions such as banks, mutual funds and deposit takers have been asking customers to self-certify their country of tax residence in order to comply with the new Common Reporting Standard (CRS) law.

The CRS is an Organization for Economic Cooperation and Development initiative involving more than 100 countries that have agreed to share some financial account information about foreign tax residents. It is similar to the Foreign Account Tax Compliance obligations that a more limited number of countries have with the American Internal Revenue Service.

Finally in April, Fringe Benefit Tax, Gaming Machine Duty and Withholding Tax will join the Goods and Services Tax in moving onto the new online system. While the due dates for these payments will not change, it will be possible to file and amend returns online and to pay by direct debit.

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.

The next phase of the New Zealand Inland Revenue’s business transformation programme will roll out in April.

Enabling legislation introduced last year is designed to simplify tax processes and integrate them with day-to-day business activities. A new option for managing provisional tax through Accounting Income Method (AIM) software is also to become available from the start of the new tax year, according to the Inland Revenue Business Transformation bulletin.

The AIM system is designed to simplify the payment of provisional tax for small businesses by enabling them to match their payments to their actual cashflow using accounting software.

But proposals for the Payday Reporting of PAYE information are also in the pipeline. If the legislation is enacted, the regulations would be voluntary until April 2019. Under the terms of the suggested rules, employers would be required to submit PAYE information every payday instead of monthly and would be able to file returns directly from their payroll software.

From April, it will also be mandatory for financial institutions to report some financial account information about foreign tax residents to the Inland Revenue on an annual basis.

Since 1 July 2017, financial institutions such as banks, mutual funds and deposit takers have been asking customers to self-certify their country of tax residence in order to comply with the new Common Reporting Standard (CRS) law.

The CRS is an Organization for Economic Cooperation and Development initiative involving more than 100 countries that have agreed to share some financial account information about foreign tax residents. It is similar to the Foreign Account Tax Compliance obligations that a more limited number of countries have with the American Internal Revenue Service.

Finally in April, Fringe Benefit Tax, Gaming Machine Duty and Withholding Tax will join the Goods and Services Tax in moving onto the new online system. While the due dates for these payments will not change, it will be possible to file and amend returns online and to pay by direct debit.

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.