It’s tax time again. Income tax returns for the year ending 31 March 2016 are due by 7 July. If a tax agent or accountant files on your behalf, in most cases you’ll automatically receive an extension. Filing tax returns can be a daunting task, especially if it’s the first you’ve filed for yourself or your company. Here are our top tips:
As a small business owner, you’ll most likely need to file one or more of the following:
You need to file an IR3 – or IR3NR if you’re not a New Zealand resident – if you earned income other than salary, wages, interest, dividends, and/or taxable Māori authority distributions. Use Inland Revenue’s online tool Work out my income tax filing options (external link) to check if you need to file an IR3.
All active New Zealand resident companies must file an IR4 each year. Plan on setting aside at least an hour to complete your online IR4 once you have your income details for the tax year.
Every partnership or LTC must file an IR7 showing its total income after expenses, and attach a Partnership income/loss attribution (IR7P) or LTC income/loss attribution (IR7L).
Types of income tax returns (external link) — Inland Revenue
You can file the following returns online via myIR:
All other returns must be posted to Inland Revenue, PO Box 39090, Wellington Mail Centre, Lower Hutt, 5045.
Tips on filing online returns (external link) — Inland Revenue
Before you get started, decide if you’ll try to file on your own or pay an accountant or tax agent to do it for you. This will cost more upfront, but it’s money well spent if they help you claim the deductions you're allowed or keep you from making mistakes on your returns.
Whether you file your own return or hire an expert to do it, you need to organise your records. The more complete and orderly your income information, the less time it will take you or your tax expert to complete your returns.
Check and recheck your return before filing it. If you realise your return has mistakes in it, correct these as soon as possible. Honesty is always the best policy.
Missing the July 7 deadline could mean a late filing penalty. If you find you don’t have all your income details in time, or you’re unsure about your tax situation, ask for an extension rather than risk submitting a late, incomplete or incorrect return.
Tips on filing for an extension (external link) — Inland Revenue