Tax Talk | Inland Revenue confirms no penalty for late payment or late filing

The Inland Revenue Department is reassuring customers they won't be penalised for late payments and asking that people do not try to contact them via phone, instead to use MyIR. 

Time to read: 3 mins

The following is a press release issued by Inland Revenue on 25 August 2021. Contact your Baker Tilly Staples Rodway if you wish to discuss how this applies to your business.

The Inland Revenue is reassuring customers they won’t be penalised if they can’t pay their tax on time during the current high Covid alert levels.

"We know many people are having difficulty getting hold of us at the moment about general tax issues, such as GST. While we are in lockdown, if a business is unable to pay its taxes on time due to the impact of COVID-19, we understand. You don’t need to contact us right now. Get in touch with us when you can via myIR, and we’ll write-off any penalties and interest.

"We know also that it might be challenging for people to continue filing returns at this time  but it would help if they could continue to file, as we need the information to make correct payments to people, and to help the Government respond to what is happening in the economy."

As all Inland Revenue offices are closed during Alert Level 4 and customers are still in lockdown, there is no option for dropping returns in or making payments through Westpac branches which also remain closed.

Inland Revenue is currently receiving thousands of calls hourly and many we cannot answer. The lower than normal volume of calls answered is due both to call centre staff working from home because of lockdown and the closure of IR’s main Wellington building.

We are also supporting MSD with wage subsidy verification and are responsible for the Resurgence Support Payment which are both also taking up IR people’s time.

For details about filing and paying, see ird.govt.nz/covid-19/manage-my-tax/filing-and-paying

For information about COVID-19 relief, visit ird.govt.nz/covid-19

Baker Tilly Staples Rodway Comment

With the first instalment of 2022 provisional tax due on Monday for many taxpayers, as well as a GST return and payment due on the same date, many businesses are worried about being able to make payment of these taxes on time – especially with cashflow under pressure, physical banking services generally not being available, in addition to many thousands of people currently under isolation.

Ordinarily, late payment and filing would result in the imposition of late payment and filing penalties as well as the charging of use of money interest. Based on the statement above, Inland Revenue have made it clear they will not be penalising taxpayers who are filing their returns late or making payments late if this is due to the current lockdown. Taxpayers need to apply to Inland Revenue to obtain relief and should do so as soon as they are able.

While Inland Revenue are being accommodating during this time, they also emphasise the need to file returns as soon as possible given that the information these returns provide assists government in their economic decision making.

From experience Inland Revenue systems are unable to write off penalties and interest until the core tax has been paid – therefore it is likely penalties and interest will continue to show in Inland Revenue systems. Please do not be concerned if this is the case and you have obtained confirmation that penalties and interest will be written off.

If you require any assistance in seeking relief from penalties and interest, or other options which may be available for managing your provisional tax obligations, please contact your Baker Tilly Staples Rodway advisor.

DISCLAIMER: Our team is dedicated to helping you continue with business as usual, as much as you can. Information on government help is changing constantly and within hours of articles being added, the specifics may be out of date or only partially accurate. While we endeavour to keep this website accurate and current, our top priority is providing our clients with dedicated and relevant personal advice. If you need specific and up-to-date information, please seek help from your usual advisor directly.

No liability is assumed by Baker Tilly Staples Rodway for any losses suffered by any person relying directly or indirectly upon any article within this website. It is recommended that you consult your advisor before acting on this information.

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