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Covid-19 IR Initiatives

Automatic Income Tax Write-Off Threshold

 

For 2020 only, Inland Revenue will be writing off terminal tax amounts of $200 or under. This write off applies ONLY to individuals, who receive an automatically calculated assessment. (What used to be called an IR5 but is now commonly known as a PTS (Personal Tax Summary).

 

 

Filing Returns & Making Payments

 

The Inland Revenue still expect to you to file all relevant tax returns on time ( eg. GST, PAYE, FBT, Income Tax etc). However, the Inland Revenue do have initiatives to help with making the payments.

Payments may be made via:

  • Westpac - the Bank will be open one day a week at least even under Lockdown.

  • Credit Card or Debt Card

  • Direct Debit Payments

  • Internet online Banking

  • Acceptable Payment Arrangement( monthly instalments)

 

If you are having difficulty making payments, the Inland Revenue have the discretion to write-off any penalties ( including Use of Money interest (UOMI)) if your inability to pay is directly related to Covid-19.  There must be a request for remission of the interest & penalties charged to the Inland Revenue with an explanation as to how the Covid-19 pandemic has impacted on your ability to make your payments on time.

 

Covid-19 Cashflow Loan Scheme

 

Just a reminder that you have until 31 December 2020 to apply for the Inland Revenue Cashflow Loan. The maximum amount available is $10,000 plus $1,800 per full-time equivalent employee.  You apply for it on the Inland Revenue website. The conditions are:

 

  • It’s a one-off loan

  • Term is 5 years

  • Interest free ONLY if repaid within 1 year

  • Less than 50 or fewer full time employees

  • Repayments are not required for the first 2 years

  • Interest will be charged at 3%

    • NB: the  interest will be charged from the start of the loan.

  • IMPORTANT –

    • If a default event ( Clause 9.1) occurs then the loan plus any interest becomes repayable IMMEDIATELY

    • A default event is defined as

      • You do not make your payments as due

      • You cease to carry on the business for which the Loan was made

      • You sell the business or substantially all of the business assets

      • You go into liquidation/administration/receivership or similar

      • You breach or do not comply with any information made on your behalf in order to qualify for either the cashflow loan or the wage subsidy scheme ( for example if you received the Wage Subsidy and the DSW discover that you did not qualify for it then the cashflow loan will become immediately repayment with any interest that may have been charged).

 

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Key Dates

  • 5th   September -   Employer deductions for large Employers (ie more than $500,000 PAYE + ESCT per annum)

  • 20th September -   Employer deductions payment due for both large and small Employers

  • 28th September -   GST Return and Payment due for the period ended 31 August 

  • 5th   October      -   Employer deductions for large Employers (ie more than $500,000 PAYE + ESCT per annum)

  • 20th October      -   Employer deductions payment due for both large and small Employers

  • 28th October       -  GST Return and Payment due for the period ended 30 September 

  • 28th October       -  Provisional Tax due if have a March balance date and use the ratio method.

  • 5th   November   -  Employer deductions for large Employers (ie more than $500,000 PAYE + ESCT per annum)

  • 20th November   -  Employer deductions payment due for both large and small Employers

  • 28th November   -  GST Return and Payment due for the period ended 31 October 

  • 5th   December   -  Employer deductions for large Employers (ie more than $500,000 PAYE + ESCT per annum)

  • 20th December   -  Employer deductions payment due for both large and small Employers

  • 15th January       -  GST Return and Payment due for the period ended 30 November 

  • 15th January       -  Provisional Tax due if have a March balance date and have a provisional tax to pay.

  • 15th January      -  Employer deductions for large Employers (ie more than $500,000 PAYE + ESCT per annum)

  • 20th January      -  Employer deductions payment due for both large and small Employers

  • 20th January      -  FBT for the quarter ended 31 December 

  • 28th January      -  GST Return and Payment due for the period ended 31 December

Some Advice From Your Friendly Accountant

If you are going to buy a business, purchase or sell land, invite an employee to become a shareholder or partner in your business, or make any substantial changes to your financial situation

 

PLEASE talk to your Accountant first. 

 

What may seem like a great idea could cause you serious problems if it is not done right.

Contact Us

Call us on:  (03) 3499 572
 

Email: office@hornbyaccounting.co.nz
 

Our Address:  
7 Goulding Avenue,
Hornby, Christchurch 

Postal Address:  
P O Box 16384,
Hornby, Christchurch 8441

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