Every year, many people miss out on getting a tax refund simply because they hate filling out forms and dealing with Inland Revenue. Over recent years, several companies have sprung up to offer a service to such people so they can get a refund without having to do the work themselves. Often, the fees charged for what is a relatively simple process, have been a large proportion of the refund received. However, Inland Revenue has recently announced some changes which will make it much easier for people to get refunds. Companies which have been offering refund services will thankfully no longer have a reason to operate.
For the next tax year, Inland Revenue will automatically process tax refunds. If, for example, you reduce your annual income by changing from full time to part time work, you should be eligible for a chunk of cash back at the end of the tax year. People who are in employment or on a benefit such as NZ Superannuation and have other income, such as from a small business or an investment portfolio, need to fill out an IR3 form. The process for completing a tax return will be made much easier. At present, these people need to add in their income from which PAYE has been deducted, as well as their other income. This usually means requesting a personal tax summary from Inland Revenue which shows the total income from earnings and the amount of tax deducted. From the next tax year, this information will be automatically filled in to myIR accounts. Adding the additional information to the online form to show other income will also become much easier. Expenses relating to this income can also be claimed – such as business expenses or the cost of professional advice relating to an investment portfolio.