A Week in Review

Richard AshbyPartner, Gilligan Sheppard

Late filed 2019 Income Tax Returns

IR has acknowledged that one potential impact of Covid-19, more-so since the commencement of the nationwide lock-down, is 2019 income tax returns not being filed by 31st March 2020. Usually when this happens, the taxpayer is exposed to a late filing penalty being in the range of $50 – $500 (net income dependent).

In this regard, IR has announced that no late filing penalties will be imposed on 2019 income tax returns filed post 2020, although with an accompanying caution that checks may still be undertaken to confirm that the late filing was Covid-19 related.

IR has also acknowledged, that filing a 2019 income tax return post 31 March 2020, could potentially increase the four year time bar by another 12 months, to 31st March 2025 instead of 31st March 2024.

To alleviate any concerns taxpayers may have in this regard, IR has stated that as at 31st March 2024 the Commissioner will close any review or other compliance activity for any 2018/2019 income tax return which is:

  • due on or before 31st March 2020 and is furnished after 31st March but before 31st May 2020;
     
  • not subject to any existing exclusions from the standard four year time bar; and,
     
  • not subject to a dispute:
    • commenced by NOPA issued before 1st January 2023, and
    • involving alleged tax avoidance, or
    • having tax in dispute of greater than $200 million.

Minimum hourly rate increase

It’s not directly tax related, however I’ve now got myself into a trend of updating you all annually in any event, with respect to the increase in the minimum hourly rates from 1st April each year.

Somewhat questionable due to the present climate in which employers are now operating, particularly those who have had to close their businesses during the four-week lock-down period (which may yet be extended) and are trying to retain their employees during a time when cash flow is already under significant strain, however the Government is determined to press ahead with its plans to have the minimum hourly rate for an adult worker set at $20 per hour by 1st April 2021.

So from 1st April 2020, the minimum hourly rate for an adult worker, who is neither a trainee nor a starting-out worker, is increased to $18.90 per hour. The daily minimum is $151.20, the weekly minimum is $756.00 and the fortnightly rate is $1,512.00. Hours worked in excess of the daily, weekly or fortnightly rates must be paid at $18.90 per hour. 

For those starting-out workers and trainees, the new hourly minimum is $15.12, with the daily rate being $120.96, the weekly rate $604.80 and the fortnightly rate $1,209.60. Hours worked in addition to the daily, weekly or fortnightly rates must be paid at a minimum of $15.12 per hour