A Week in Review

Richard AshbyPartner, Gilligan Sheppard

IR Withdraws SPS

Perhaps not quite as dramatic as the title suggests, IR has withdrawn a 2008 Standard Practice Statement – SPS 08/03 Income Tax Act 2007 – Penalties and interest arising from unintended legislative changes.

The SPS was issued by IR to counter concerns that the enactment of the Income Tax Act 2007 effective from the commencement of the 2008/09 income year, may expose taxpayers to penalties and use of money interest charges as a result of tax shortfalls arising due to unintended legislative changes.

While no changes to pre-existing law except those specifically listed in Schedule 51 were intended, it was however accepted such changes may still arise, due to the difference in language used in the redrafted legislation (to make it more user friendly). Naturally taxpayers were still required to meet their tax obligations when an unintended change had resulted in a tax shortfall, however they should not be subject to any penalties or interest charges where reasonable care had been taken.

The date of withdrawal of SPS 08/03 is 1st July 2018.

BEST START

Just on case you missed the previous update, a reminder, as this payment is essentially available to any eligible person and not just those lower income families most family tax credits are targeted towards.

So if you are:

 The principal caregiver of the child; and,
 You are a NZ resident/citizen (at any time having been in NZ for 12mths continuously); and,
 You are a NZ tax resident;

And your child is:

 Born after 1st July 2018 (or born earlier but due date was post 1st July); and,

 Both resident and present in NZ; and,

Has an IRD number

Then you can:

 Claim $60 per week until your child turns one regardless of your household income level; and,

 If your household income is less than $93,858, continue receiving credits for the next two years, although at a reduced rate once your household income exceeds $79,000.

Note that if you are receiving paid parental leave for the child, you will not be entitled to start receiving the Best Start payments until your entitlements under that regime have ended.
The best way to apply for the Best Start payments is via the SmartStart website – https://smartstart.services.govt.nz/register-my-baby.

Richard Ashby BBus, CA, CPA PARTNER
Em: [email protected] Ph: +64 9 365 5532 Fx: +64 9 309 5260 Mb: +64 21 823 464