We estimate that the NZ Government collectsapprox$50 billion in taxes eachyear.Of course, tax is an essential part of any thriving democracy and it pays for essential services like health, education, roading andsocial welfare etc. Our aim with these NZ tax refund facts and tips is to ensure that you are not contributing more than you need to!
We’re pretty good at what we do!
FACT: Since we started our IRD registered tax agency in 2008, over 200,000 people have asked us to help them get a well earned tax refund. We aim to get you the biggest possible tax refund based on the information that you provide us with during the application process. The biggest single client refund we have recovered was over $52,000.
Tip: If you want the biggest possible refund, simply complete our application form and ensure you answer all the questions as accurately as possible.
What can youclaim as a Business Expense?
If you are purchasing something solely for business purposes, then in most instances you can claim the whole cost of the item.
If you have an expense that is for mixed use (i.e personal and business) then you can only claim the proportion that is used for business (e.g. if you use your mobile phone for both work and personal calls then you can only claim 50% of the phone bill).
N.B. It's really important that you retain a copy of a valid receipt or invoice. You will be required store/hold copies of all expenses that you claim for up to 7 years.
Different expenses have different rules on how much tax relief you are entitled, not every item will be 100% tax dedcutible. Read our FAQ section for more information on claimingwork related expenses
FACT: It is the taxpayer’s responsibility to ensure that their employer is using the correct tax code. When starting a new job, you need to indicate to your employer what your tax code should be by filling in an IR330 form. If your circumstances change during employment, you need to inform your employer and complete another IR330 form.
Tip: If your circumstances change, ie you start a new job or forsee any changes to your income, your tax code may need to be changed. If you begin receiving another source of income, have a significant change in your earnings or your family begins receiving working for family tax credits, check again that your tax code is still correct!
Tip: If you start a 2nd job, it is likely that you will need to use a secondary tax code. If you don’t, you could end up with a big tax bill at the end of the year.
Working For Family Tax Credits
FACT: If you have children, depending on your circumstances, Inland Revenue will provide additional financial support in the form of Working For Family Tax Credits. How much money you will get is dependent on a number of factors including the number and age of your children, your total family income and whether or not you are employed. You can choose to receive these additional payments either weekly/fortnightly or as a lump sum at the end of the NZ tax year.
Tip: At the end of the financial year the IRD will assess the payments you have received. If you have received more than your entitlement they may issue you with a tax bill. To avoid this from happening, always overestimate your family’s income for the year. That way you’ll end up with a bigger refund at the end of the year.
Tip: If you have chosen to receive your WFFTC as a lump sum, you need to let IRknow if the care arrangements for your children have changed during the year and theywill ensure you get the maximum possible refund. Also, let IRknow if you’ve had any more children during the past year as you may be eligible for a Parental Tax Credit. You’ll receive a much bigger refund at the end of the year if you choose the lump sum option.
FACT: Schedular payments are typically paid to you when you are working as a contractor rather than an employee. You might receive schedular payments if you have done any promotional work, acting or modelling, temp work of any commission based sales work. Schedular payments are usually taxed at a flat rate for example it’s 20% for commission based sales work. If you have received schedular payments you may be able to claim workrelated tax deductible expenses.
Tip: If you are receiving schedular payments you may be able to claim for work related expenses that were incurred during the period you were receiving schedular payments. In order to claim, make sure you keep all of your receipts and records.
Tip:If you have been asked by your employer to use a WT tax code, this will be a good indication that you are receiving schedular payments.
Tip: If you plan on claiming any vehicle related expenses you will need to keep a log book to record your mileage when your vehicle has been used for work related and purposes and personal travel.
FACT: If you have made a donation of over $5 to a registered New Zealand Charitable Organisation you may be able to claim a third of this back as a donations rebate. You can only claim donations rebates for the past 4 tax years.
Tip: Keep all of your donations receipts and statements and send them into us at the end of the financial year.
FACT: As an employee there are very few tax deductible expenses that you can claim. However, if you have paid any premiums for loss of income insurance or if you have someone to prepare, assess or check your tax return, we will be able to claim a tax credit for these expenses.
Tip: You can check with the insurance provider as to whether a premium is able to be claimed as a tax deductible expense. Remember to keep the statements so that we can include these in your tax return at the end of the financial year.
Tip: Our processing fees are a tax deductible expense and by including these in your assessment it will increase your NZ tax refund.
FACT: If you have received any other form of income over $200 other than wages or salary then you must declare this income and we have to include it in your return.
Tip: The good news is that you may be able to claim anyexpenses incurred in the generation of this income but will need toprovide receipts or statements.
Changes to Property Rules
New Zealand citizens and residents
FACT: When buying, selling or transferring New Zealand property,excluding yourmain home, you nowneed to provide your:
- IRD number
- taxpayer identification number (TIN)from any overseas countries where you have to pay tax on your worldwide income, if you have one.
Tip: Give this information toyour property lawyer or conveyancer this information. You can also do thisby filling in a Land Transfer Tax Statement, which is available on the Land Information New Zealand (LINZ) website.If you’re transferring property that’s in trust, you need tosupply the IRD number for the trust. Trustees’ IRD numbers can’t be accepted.
FACT: When buying, selling or transferring property in New Zealand, you now have toprovide your:
New Zealand IRD numberand
taxpayer identification number (TIN)from any countries where you have to pay tax on your worldwide income.
Tip: Give this information to your property lawyer or conveyancer this information. You can also do this by filling in aLand Transfer Tax Statement, which is available on the Land Information New Zealand (LINZ) website.