Recent tax changes

The beginning of April marks the start of the new financial year in New Zealand. And along with the new financial year, there are many tax changes that have come into effect.

Here are four important tax changes affecting employers, individuals and contractors:

The bright-line test
The bright-line test for residential property has been extended from 2 years to 5 years from 29 March 2018. The extended bright-line test only applies to properties for which an agreement to purchase the property was entered into on or after 29 March 2018. The 2-year bright-line test will remain for properties entered into before that date. The 5-year bright-line test will operate in the same way as the 2-year bright-line test.

Payday filing
Payday filing is an online option for submitting employment information to the IRD every payday. It is voluntary from April 2018 and will become compulsory from April 2019. There are three ways to file online: direct from your payroll software, by file upload in myIR, and on-screen in myIR.

Changes to myIR
MyIR has a range of changes made from 17 April 2018. The ‘My GST’ section has changed to ‘My Business’ and now employers can:
Register for and delete account types
Include attachments when you send IR a message
File, pay and amend GST, FTB, GMD, PIE returns

Introduction of AIM
From 1 April 2018, the accounting income method (AIM) is the new option for provisional tax. AIM allows employers to get refunds throughout the year. It can help business owners to manage their cash flow better as you do not need to pay provisional tax if you do not make a profit.

Posted on 3 May '18 by , under tax.