The next provisional tax instalment date is 29 October 2024.
Provisional taxpayers with the below balance dates may have a tax instalment due on 29 October 2024:
- Taxpayers with a 31 March balance date that file their GST returns 6-monthly will have their first provisional tax instalment due for the 2025 tax year.
- Taxpayers with a 31 January balance date will generally have their second provisional tax instalment due for the 2025 tax year.
- Taxpayers with a 31 May balance date will generally have their first provisional tax instalment due for the 2025 tax year.
- Taxpayers with a 30 September balance date will generally have their third provisional tax instalment due for the 2024 tax year.
Inland Revenue’s focus on cryptoassets
Inland Revenue has announced there is now an increased focus on individuals transacting in cryptocurrency assets who fail to declare their income. Cryptoassets are considered property for tax purposes and profits from their sale, trade, or exchange are taxable. IR has updated their guidance on cryptoasset taxation and has sent letters to high-risk customers to address any potential non-compliance.
Recent data shows that there are 227,000 unique cryptoasset users in New Zealand with a transaction value of $7.8b. IR emphasises the importance of declaring crypto income especially given current high values. There is extensive guidance now available to help enable New Zealand taxpayers to comply.
For more information on the taxation of cryptoasset income, please refer to : https://www.ird.govt.nz/cryptoassets/taxing or get in touch and we can refer you to a specialist.
Reassessment
In the case of a reassessment of a previously filed return the use of tax pooling is guaranteed. If you are filing a voluntary disclosure you can apply for commissioner's discretion to use tax pooling.
If you would like to discuss this with us to help evaluate your options to best manage any tax exposure feel free to get in touch.
TPS away day
The Tax Pooling Solutions team will be out of office tomorrow on 18 October 2024 on a team volunteer day. For any urgent matters, please email jonathan.t.gray@pwc.com
“Lesser of” approach in calculating provisional tax
At this point in the year, 2025 provisional tax is generally calculated based on a 10% uplift of the 2023 RIT. This is because the 2024 tax returns are not due until 31 March 2025 for taxpayer’s with a valid extension of time.
When the 2024 return is assessed, IR will recalculate the 2025 provisional tax amounts based on a 5% uplift of the 2024 RIT. If this returns a lower value, IR will restate the 2025 provisional tax to this lower amount.
As an advisor, if you are reasonably certain that the 2024 RIT is materially lower than the 2023 RIT you can factor this into your provisional tax planning with your clients to help them manage their cash flow without exposing them to late payment penalties or UOMI.
If you would like to discuss any specific situations you have feel free to get in touch.
Other important dates
Provisional taxpayers with a 31 October balance date and no Extension of Time for the 2024 income tax year will need to have all purchased and financed tax for the 2024 income tax year transferred out of the tax pool and into taxpayer IRD income tax accounts by 23 November 2024.
If you require any last minute purchases feel free to get in touch.
