Here are some changes coming in April 2020, to make tax more straightforward and to help you serve your clients.
For more detail on all these changes, including screenshots, you can watch one of our webinars live and on-demand.
Changes for employers
We’re making some changes to myIR and payroll accounts will look a bit different. All employer accounts (for each payroll profile) will be combined into a single Employer Activities (Payroll) account to manage Employment Information transactions and obligations. As a result of these changes:
- transactions will be grouped and presented differently and will show up sooner than they do today
- correspondence about employee changes will be grouped so that we won’t write to you as often
- you may be asked to provide more information about employees such as hours paid, if you have it
- small balance write-offs, late payment penalty thresholds and use of money interest thresholds will now apply to the overall employer account balance, not each sub-account individually
- we’ll notify employers when an employee’s student loan is almost repaid - telling them the final deduction amount and the new tax code
- when on-boarding new employees, the new employee details (IR346) and KiwiSaver (KS1) information will be in one form.
Investment income reporting
Providers of investment income benefits or payments should be aware that:
- they need to start filing electronically, in more detail and more frequently from 1 April 2020
- there is a new exemptions register for you to check (instead of asking the person you are paying to provide you with an RWT certificate of exemption)
- the new non-declaration rate for RWT on interest income will be 45% from 1 April 2020.
Direct debits in myIR
You and your clients can continue to pay us by credit card, debit card and online banking. But, after Easter 2020, if you choose to pay by direct debit in myIR from a new bank account a direct debit authority will need to be set up.
- Setting up the authority is a one-off process and will need to be set up separately for each new bank account before a direct debit payment can be made.
- You can continue to pay by direct debit for a client if you have signing authority on the bank account being used (such as if it’s your businesses own bank account) after you have set up the authority in myIR.
Other changes coming in April
The student loan repayment holiday has been renamed to “temporary repayment suspension” to make it clearer that this is a temporary break.
If you’re linked for student loans, you’ll be able to bring your client’s student loan accounts into your workspace.
From 1 March 2020 we’ll no longer accept payments by cheque, including cheques dated after 1 March.
We’re developing a new and improved Tax Technical website – the first stage will be ready soon.
Short process rulings
Short-process rulings are a way for individuals and organisations, with an annual gross income of $20 million or less, to apply for a binding ruling on how a tax law applies to a situation.Short-process rulings
Research and development tax incentive
The R&D tax incentive provides a tax credit at a rate of 15 per cent of eligible R&D spend up to $120 million. To be eligible, your clients need to spend at least $50,000 per year on eligible R&D.
Rental loss ring-fencing
From the 2019-20 income year onward, new rules apply to losses claimed for residential properties. Residential property losses will now be ring-fenced, meaning that they cannot be used to offset other income.