As we look forward to the Christmas break, please don’t
forget that on 15 January 2014 you may be required to make a provisional tax
payment to the IRD if your balance date is 31 March. This is the second provisional
tax instalment due for the income tax year ended 31 March 2014.
So who has to make a payment? Prima facie a taxpayer who had
residual income tax of $2,500 or more in the prior income tax year (31 March
2013) will be required to make a payment to IRD. However, we all know prior
trading history does not always reflect the current income year. There will be
taxpayers out there who are not obligated to make a payment, yet are trading
well and should consider making a payment to avoid penalties and use of money
interest. There will also be taxpayers who are trading well down from last
year, and should consider holding off on making a provisional tax payment.
Provisional tax is a complicated beast; if you are uncertain
about your obligations please contact Walsh & Associates for further
advice.