Tax Breather For Flood Affected Businesses

Tax Breather For Flood Affected Businesses

Farmers will be heartened by the generous offer of Tax Management New Zealand to provide up to one month's tax relief for businesses badly affected by the February flooding, said Tom Lambie, President of Federated Farmers of New Zealand (Inc).

The offer allows flood-affected businesses to delay making provisional and terminal tax payments until as late as 29 April 2004. Tax Management New Zealand (TMNZ) will effectively cover farmers and business' tax liabilities for the month of April. No interest will be charged.

This assistance is in addition to the Government's relief package. The Inland Revenue Department (IRD) has announced that it will use discretion, where appropriate, to waive penalties. The Government will be changing tax legislation to waive interest on late tax payments, though strict criteria will apply.

TMNZ will make a $10 million flood relief deposit with IRD which taxpayers will be able to use to defer their provisional or terminal tax payments by up to one month. The limit per taxpayer is $50,000.

Business people affected by the floods should contact IRD and TMNZ to arrange the best way of managing their tax liabilities.

Steps to Defer Provisional Tax

Available from Monday 15 March 2004

1. Apply to TMNZ for an allocation of the Flood Relief Deposit - phone 0800 TAX DEFER (0800 829 333) or have an accountant or tax agent apply through the TMNZ website www.taxmangement.co.nz

2. TMNZ will confirm by email the allocation within two working days.

3. Deposit the deferred tax amount into the nominated Guardian Trust Tax Account by 29 April 2004.

4. TMNZ and Guardian Trust will arrange for the tax to be credited to the taxpayer's account effective from the nominated payment date between 31 March and 28 April 2004.

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