ZB ZB
Live now
Start time
Playing for
End time
Listen live
Listen to NAME OF STATION
Up next
Listen live on
ZB

Automatic tax refunds coming for nearly 750,000 wage and salary earners

Author
NZ Herald,
Publish Date
Fri, 3 Aug 2018, 2:13PM
Photo/123RF.
Photo/123RF.

Automatic tax refunds coming for nearly 750,000 wage and salary earners

Author
NZ Herald,
Publish Date
Fri, 3 Aug 2018, 2:13PM

Getting a tax refund is about to get a whole lot simpler.

Around 750,000 wage and salary earners are expected to get automatically generated tax refunds next year, according to the Inland Revenue (IR).

The change, which will come into effect in April 2019, is one of the biggest to individual tax in nearly 20 years.

Naomi Ferguson, Inland Revenue commissioner, said it hasn't been mandatory for wage and salary earners to fill out an IR personal tax summary (PTS) but if they had and it had indicated a refund, they could have filed a return and received that refund.

"In the new system, all wage and salary earners' tax will be calculated and refunds sent automatically," Ferguson said.

Inland Revenue commissioner Naomi Ferguson. Photo / File
Inland Revenue commissioner Naomi Ferguson. Photo / File

"About 110,000 more, who also haven't been filing, will have an amount to pay – they'll be notified automatically.

"Getting a refund, if you're entitled to one, will be a whole lot simpler because it will be done for you."

Ferguson said the only reason to contact the IR will be to tell them about any additional income information they need to know.

"Put simply, IR will now look at the information we have about an individual and if we're confident we have all their information, we'll calculate and finalise their tax position for the year and generate an automatic refund - so there's no need for a PTS, making it a very simple process for wage and salary earners," Ferguson said.

"But it's still a big change from what so many people have become used to.

"It will be very important that everyone has made sure the details we hold about them – bank account number, contact details and so on – are fully up to date so the new system works well for them. We'll be communicating widely to make sure customers know what's changing, when, and what they need to do."

Other changes that will come into effect from April 2019 include:

• making it easier to manage income tax and Working for Families, which includes some changes to myIR for both businesses and individuals

• reporting of PAYE information every payday for employers – which is now voluntary – becomes compulsory.

• more regular reporting of investment income information becomes voluntary – and then mandatory a year later.

Take your Radio, Podcasts and Music with you