For many years it was acceptable to put the payment along with the form in the mail at 5pm the day it was due. However, IR are making it increasingly difficult to run your business without online banking and the internet.
Inland Revenue (IR) has made this clear to tax agents. However, some business owners are still too busy to read all the mail IR sends. If you pay IR they need to receive the payment by the due date.
If you think you can get away with just using an overnight courier think again. In our very office just last month we had to get a package delivered locally within the Wellington region. Courier Post was advised of the pickup 10am Friday morning. We paid for the overnight Saturday delivery in the hopes to get it delivered in time. Needless to say the package was not delivered until Thursday the next week.
With the changes in New Zealand Post regarding their delivery days it would be wise to ensure that any payments made to IR via cheque be sent at least two weeks prior or else you may be up for significant late payment penalties.
At this point there have been no changes to the allowances for weekends and holidays. However, they have looked at treating Provincial holidays (i.e. Wellington anniversary day) as being just another week day.
For those people that have no faith in sending money via the post and currently pay at the local Westpac please be aware they will no longer accept payment by cheque.
If you are willing to use the online banking option most banks have a “make tax payment” or similar. All you need to do is enter your IRD number, payment type and the amount.
With the new rules coming into effect in October it would be worth doing this months GST and PAYE as dry run.
Audits and your accountant
With the budget announcing increases in IR’s funding for tax compliance it is little surprise that many accountants are now taking measures to ensure they are not left holding the ball. When IR come calling with the calculator and highlighter in hand you know it’s going to be a bad day.
Many people who are audited arrange to have the meeting and any subsequent work done at the accountants on mutual ground. As an added bonus the accountant can often ensure the questions asked are answered in the cleanest way without needing to answer subsequent questions.
Nobody likes unexpected costs. If you manage to dodge the bullet with IR you may still be left with a bill from the accountant for their time, and since it is unexpected there is often little money budgeted to pay the accountant. Especially if IR does make some changes so the accountant's bill is normally the last to be paid. However, many accountants are now offering Audit insurance. Audit insurance is the cover to pay the accountant, not IR. and often for only a couple of hundred dollars.
By Shawn O’Grady
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Keep an eye out for July’s article!
TAX DATES TO REMEMBER
20th July 2014 - monthly employers PAYE payment…
* 28th July 2014 - Bi monthly GST Return for May/June 2014...
* 28th July 2014 - Six monthly GST Return for May/June 2014...
Posted on Tue, 1 July 2014
by Shawn O'Grady