Note: Tax payers are likely to get two Tax reminders, one from the Inland Revnue and one from Bailey Ingham Ltd
Important message for Tax Agents
7 April Due Date – Update for Tax Agents
Inland Revenue has been improving the way we collect overdue debt for some time now. We’ve also been working to understand why people go into debt and have developed some initiatives to increase on time payment.
We value our relationship with the tax agent community and the important work you do supporting your clients to meet their tax obligations. However, the ultimate responsibility for paying on time rests with each individual.
We continue to see high numbers of people who miss the 7 April due date and have received feedback that customers are not always aware of their 7 April payment obligations. We’ve successfully increased the compliance of customers with payments due on 7 February by sending reminders before this due date. So, we’ll use the same approach to support customers with payments due 7 April 2018.
In 2017 we issued around 113,000 reminder letters and 5,000 text messages direct to customers with a 7 April liability. These customers had already filed their return, and had it processed by us. Our evaluation of this activity showed that more people paid after receiving the reminder letter, than those who had received only a text message. This is consistent with our findings around similar events.
In 2018 we plan to send reminder letters directly to customers who have filed their 2017 Return and have a liability to pay by 7 April 2018. We won’t include any customers who are owed a refund, or have paid their liability.
Additionally, we will also be making it clear for those who have short paid or underpaid provisional tax that it is accruing interest. This messaging aligns with feedback received from Tax Representatives that customers would like a higher degree of visibility and understanding in respect to their provisional liabilities and payments.
We will also be issuing a text message reminder to those customers we don’t send a letter to. These will be issued on 14 and 15 March. We will endeavour to text the customer rather than their representative however, if an agent’s mobile number has been added to a customer’s account, the agent is likely to receive the reminder text. Each mobile number should only receive one text message.
After the 7 April due date, as in past years, we will follow up with those who have not paid, especially where we know their tax agent has had earlier Classified Public
notification from us and we have not yet had any contact from either the agent or the customer. Our goal is to help customers resolve their debt situation as soon as possible. This helps minimise the effect of penalties and interest, which can quickly add up.
Inland Revenue has the ability to identify customers who have previously paid their 7 April liability through utilising tax pooling funds. We will exclude these customers from reminder letters and follow up recovery actions. Unless advised, we will not be able to exclude a customer who is utilising the taxing pooling service for the first time.
Customers who have successfully met their income tax obligations through paying on time or through using tax pooling funds in previous years are entitled to receive a Grace Period for their 7 April obligations. We are unable to prevent these Grace Period letters from being issued.
To assist in ensuring the reminder letters being issued have the correct balances due, please complete any credit transfers in relation to 7 April obligations on your clients account before Friday, 9 March.
You can contact Inland Revenue by:
sending us a secure email
phoning Inland Revenue’s tax agent line on 0800 377 779
You can also apply online for an instalment arrangement for any clients having difficulty paying.
7 April website available
You are welcome to share the link to Inland Revenue’s 7 April website with clients who might benefit from this information: www.ird.govt.nz/7April.
Manager, Inland Revenue