provisional tax

Provisional Tax sanity on the way

MP Judith Collins

 

A Bill that tightens the foreign trust disclosure rules, simplifies tax processes and reduces or eliminates use-of-money interest for most business taxpayers passed its final stage in Parliament…

“The new legislation tightens the disclosure rules for foreign trusts as recommended by the Shewan Inquiry,” says Revenue Minister Judith Collins.

“It also includes measures to implement the G20/OECD standard for the Automatic Exchange of Information, to help detect and prevent tax evasion globally” she says.

The new legislation also contains a number of measures to simplify tax processes. Many businesses report that the most difficult aspect of their tax affairs is calculating and paying provisional tax. The introduction of the accounting income method, the key measure introduced by the new legislation, will give smaller businesses a new pay-as-you go option for provisional tax from 1 April 2018.

The accounting income method, will allow small taxpayers to use their accounting software to calculate and pay their provisional tax taking the guess work out of calculating provisional tax. Read more »

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“Labour: making small business smaller”

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So said Paul Henry this morning as Annette King alluded to new tax policy that Andrew Little will reveal as a speech later this morning. Read more »

In business? Hate provisional tax? Vote National

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I, like many others, hate provisional?tax. ?It’s annoying, it frequently wants money from you before you have actually received it from your customers, and there is a big stick that if you guess too low, they’ll come beat you up a bit. ?Great reward for managing your business into growth.

Tom Pullar-Strecker reports on some changes that appear to be welcome at first glance

The much-hated provisional tax system that forces small businesses to forecast their tax liability a year in advance will be overhauled, Revenue Minister Todd McClay has all but confirmed.

McClay said he did not believe the provisional tax system was “fit for purpose”.

A “business transformation” programme under way at Inland Revenue, which the department expects to cost up to $1.5 billion, could allow firms to pay tax on their income in, or closer to, real time, he said.

It would be “wonderful” if Inland Revenue could get to a point when income was taxed only when it was earned, but any changes would need to be balanced against the Government’s needs, he said.

If provisional tax was linked to being paid, more like GST, then that could be less of a burden. ?End of the month, tote up your total payments, cough up x percent. ? Read more »

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