Kiwi tax refund spending shows consumer confidence

Kiwi tax refund spending shows consumer confidence

A survey* has revealed New Zealanders are showing signs of buoyed confidence in the economy, with those receiving annual tax refunds willing to splurge them on retail purchases and entertainment experiences instead of squirrelling them away for a rainy day.

The research, conducted by TaxRefunds.co.nz, showed 54 percent of people opting to spend their tax refund on a treat experience for themselves, be it new shoes or a celebratory meal out.

TaxRefunds.co.nz CEO, Phil Rance, says the results support the recent positive results from the retail sector.

“Retail sales in the fourth quarter of 2012 recorded the fastest growth in six years according to Statistics New Zealand figures. Clearly Kiwis are feeling more confident with their financial situations and are willing to go out and treat themselves,” says Mr Rance.

Of the Kiwis that indicated they like to splurge their tax refund, half spent on clothing and accessories, 45 percent on an evening out, one in five on new technology gadgets and 20 percent on domestic and international travel.

“The average refund for Taxrefunds.co.nz customers in 2012 was $428, which is quite a bit of money to have fun with if that’s what you want to do. Over 90 percent of our customers have overpaid their tax in the last 5 years, so we’re proud to be putting money back into Kiwi pockets where it belongs,” says Mr Rance.

The 18 - 29 age group led the spending spree with 64 percent opting to spend their tax refund on themselves. Results showed that those aged 30 – 49 were the least likely to indulge themselves, with only one third channelling their refunds into spending as the pressures of home ownership and parenting took effect. Almost half of this group put their tax refund towards servicing bills.

Alarmingly, results showed that one in five New Zealanders have never filed a tax return, and only half the population do so annually. Part of the reason appears to be apathy towards the tax system with 36 percent of people not knowing how to file a tax return or claiming it’s too complicated, but a further quarter of the population are also worried about owing money to the IRD or think that they won’t get enough of a refund to bother with filing.

“Nobody wants to owe money to the IRD and one of the questions we are asked most often is whether or not people should file for a tax refund because they’re worried they might owe money. The beauty of using a company like TaxRefunds.co.nz is that we do all the hard work for you, and if money is owed then we simply won’t file your Personal Tax Summary, so it’s of no cost to you to find out if you are owed a refund,” says Mr Rance.

The 2013 tax year closes on 31 March. For more information visit www.taxrefunds.co.nz.

ENDS

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