#2021#incometax

What’s new for 2021 – Income Tax

What's New For 2021

Inland Revenue will be sending automatically issued income tax assessments for most New Zealanders between late May and the end of July.

If you are using gateway services software to send income tax returns to Inland Revenue, you may also be able to complete or amend the ‘more information request’ in your software. Ask your provider if they offer this functionality.

We encourage you to complete these in a timely manner so your clients are aware of their end of year tax position promptly and receive any refund they may be entitled to (including Working for Families) or have time to make provisions for any tax to pay.

What’s new for 2021

  • From 2021 onwards any portfolio investment entity (PIE) income and tax will be included in your clients’ end of year income tax assessment. This is calculated using Prescribed investor rates (PIR), rather than income tax rates. Recent law changes mean that where PIE tax has been overpaid or underpaid it will form part of the overall income tax assessment and be offset against any income tax over or under payment.
  • Schedular payment clients who have received the COVID-19 Wage subsidy will need to complete a 2021 IR3 individual income tax return as they are required to declare this income under the new key point for Government subsidies.
  • If your clients receive joint investment income, we will allocate this from the information the investment income provider has returned. Where an investment provider only holds one IRD number, 100% of the income will be allocated to that IRD number. It is important that your clients advise their investment income provider of their IRD number, so that income can be correctly allocated. You can also update the ownership percentage in myIR providing the client has this income showing.

You can find more information on the end of tax year process at: ird.govt.nz/income-tax-for-clients-of-agents or; ird.govt.nz/end-of-tax-year