Inland Revenue advice? Don't ignore your tax debt.

www.ird.govt.nz

Ignoring tax debt won't make it go away

Inland Revenue recently reported that they have started phoning people who owe small amounts of overdue GST or employer tax — usually debts over $1,000 that are 6 months to 5 years old — to stop them from snowballing.

They’re reminding people that interest and penalties are adding up, and encouraging them to either pay in full or set up instalments. For bigger debts (over $10k), IR will also warn about potential legal action.

If people ignore calls, IR might leave one message, try again once, and then possibly visit in person. After that, they may consider deducting money directly from bank accounts or as a last resort start insolvency proceedings.

Since June, they’ve sent 16,500 bank-deduction notices (25% more than last year) and already recovered $17 million from over 8,000 deductions.

To sort it out, taxpayers can talk to IR when called, pay through myIR or ird.govt.nz, or set up a payment plan online.

All of this can seem quite scary, but in practice in most situations can be resolved quite easily with a bit of patience on both sides.

If you are worried about your tax debt, would like an intermediary between your business and the Inland Revenue or simply want help to make sure you are paying the right amount of tax, please contact us as soon as possible.