Covid-19 Update – 27 August 2021
If you or your business are having difficulty paying tax by the due date, Inland Revenue have issued some guidance.
As part of the response to COVID-19, Inland Revenue still need customers to continue to file their returns. This is particularly important as evidence of ongoing business activity which is required to ensure applications for RSP, Small Business Cashflow Scheme and applications for the wage subsidy (through MSD) progress quickly.
Inland Revenue advise, if customers are unable to pay on time due to the impact of COVID-19, they need to get in touch. If they’ve already been informed a taxpayer is adversely impacted by COVID-19, and the outstanding core tax is paid as soon as practicable, Inland Revenue will automatically write-off any penalties and interest.
A request for remission requires confirmation that:
• the amounts owing were due on or after 14 February 2020,
• the ability to pay by the due date, either physically or financially, has been significantly affected by COVID-19,
• Inland Revenue has been advised as soon as practicable to request relief and that payment of the outstanding core tax will be made as soon as practicable.
Once the submission has been processed, an indicator will be added for the client, along with a start date. If relief was requested during last year’s lockdown periods, the indicator is still active.
There are a wide range of support measures available for businesses. A summary is shown in the table below, and full details are available on the www.business.govt.nz webpage Financial support for businesses — business.govt.nz or contact our office for more information.
Payments to employees working from home
Inland Revenue have reissued a ruling which applies to payments made by employers for costs incurred (or likely to be incurred) by an employee while working from home for such things as telephone and/or internet costs.
These payments are not taxable to the employee as long as the following conditions are met:
• The expenditure must be incurred by the employee in regard to their employment
• It must be necessary in the performance of the employee’s job
• The payment must be made because the employee is doing their job
• Where an employee is partly working from home and partly outside of their home, the home-based work must be more than minor. (For example, this can apply to an employee who works at the employer’s premises on alternate days.)
GST and Provisional Tax due 28 August
The GST and provisional tax due for payment on 28 August does not need to be paid until Monday 30 August as the 28th falls on the weekend. If you have any questions regarding your provisional tax payments please get in touch with someone from our office as soon as possible.