Changes to Provisional Tax and Interest
The New Zealand government has announced some tweaks to the tax system to assist businesses. It’s not a benefit or cash bonus, but could reduce your tax bill for the 2021 tax year.
Here’s the outline from the video:
- Increased Provisional tax threshold
- Normally pay Provisional Tax if your total tax bill is over $2500
- This will increase to $5000 for the 2020-21 tax year
- Simply a cash flow delay – pay later than normal
- Won’t change any Provisional tax due on 7 May 2020
- IRD write off interest on some late payments
- Income tax terminal and provisional, GST and PAYE
- Due on or after 14/2/20
- Doesn’t change the tax owing
- Must prove inability to pay as a result of COVID-19
- No mention of waiving late payment penalties
- Application required (details not yet provided)