If taxpayers do not pay their full amount of tax owing by the due date, penalties and interest charges may be incurred:
Late filing penalty
If you do not file a return by the due date.
Late payment penalty
A payment to IRD posted or delivered after due date.
Interest charges
Interest on any underpaid tax owing. Charged at market interest rates.
Shortfall penalty
If you have paid tax on an understatement of tax. ie the correct amount of tax is higher than the amount you paid. These penalties can be as high as 150% and may include imprisonment for serious instances of evasion.
EMS non-payment penalties
If you file an employer monthly schedule but do not pay the full amount payable as per that schedule. Penalties are in addition to any other penalties that may also then be payable.
Tax payment assistance
There are some solutions to help tax payment concerns.
Tax pooling in one such solution. Give us a call if you would like to explore the Tax Pooling option.
For more information please call us on 09 373 4544 or visit https://www.ird.govt.nz/managing-my-tax/penalties-and-interest/penalties-and-debt
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