Changes to the interest and penalties regime
IRD have announced that from 1 April 2017 they will be changing the hated interest and penalties. For provisional tax payers using the standard uplift method (based on prior year) there will be no interest charged on the first two instalments. I.e. they won’t take the interest calculation back to the first payment retrospectively.
For late payments on new returns filed there will still be the initial 1% penalty the day after for late payments and 4% after 7 days but the 1% monthly incremental penalties will go. UOMI will still apply.
Proposed Provisional Tax payment Changes
You may have heard through the media that the IRD are doing away with Provisional tax. As with a lot of their recent releases, this is only partially true. But (hopefully) from 1 April 2018 your business could qualify to pay tax using the AiM Accounting Income Method.
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