Final update: April changes 18 March 2020 Employers This content is correct as at 18 March 2020; it is subject to change 1
Welcome to our webinar Rata Kamau, Transformation Account Manager IN CONFIDENCE Greetings everyone, and welcome our webinar. My name is Rata Kamau and I’m a Transformation Account Manager at Inland Revenue working with Industry Associations, Professional bodies and Iwi across New Zealand. Over the last couple of years I have been assisting our Community Compliance staff across the country presenting the Business Transformation changes to employers which many of you may have attended. Today’s webinar is all about the next round of tax changes that have occurred since April 2019 – many of which come into force on 1 April. We appreciate that these changes affect you, so this webinar is designed to help you prepare. For those of you who have seen our webinars, some of today’s content will be pretty familiar and we’ll recap some of the information. There is also some new content and screenshots. There’s a lot to cover, and it may seem a little overwhelming. But we have a lot of support available to help you manage this change. Just a quick note, the content of this webinar is correct as of 18 March. Some details may change. 2
How to participate Submit your questions here Slides Presenter info Control panel IN CONFIDENCE I’d like to run through what you should be seeing on your screen, and how to interact with us. In addition to the presentation slides on your screen you’ll see a small control panel at the bottom of your screen that contains a few buttons. When you click on each of these buttons, you’ll see they either open or close some of the features which may already be open on your screen. On the left of your screen you’ll see the slides box on which you’ll see the presentation slides. You should also see a Q&A box on your screen. By clicking in this box – in the “enter your question” section, you can send through any questions. Other participants won’t be able to see your question but they will come through to us. We will collate all questions, get them answered and send them out to all participants via email so it is important to send questions through. 3
The Business Continuity Package • The Business Continuity Package – tax relief and income assistance ird.govt.nz/Updates/News-Folder/tax- relief-coronavirus • Further proposed tax changes: https://www.ird.govt.nz/covid-19- novel-coronavirus/tax-relief/tax-relief- for-businesses • Our next round of changes are on track to proceed. IN CONFIDENCE Before we start I just want to talk briefly about the recently announced busin iness cont ontinu inuit ity y package. On Tuesday 17 March 2020 the NZ Government announced a Business Continuity Package to help those struggling with the economic impact of the COVID-19 coronavirus pandemic. One part of that package proposes to give Inland Revenue the ability to remit use of money interest (UOMI) for businesses or individuals who are unable to make their payments on time due to the impact of COVID-19. To find our more please visit www.ird.govt.nz/Updates/News-Folder/tax-relief-coronavirus Our normal options for re-estimating provisional tax, setting up instalment arrangements, remitting late payment and filing penalties, and severe hardship debt write-offs are available. We encourage impacted businesses to take advantage of them. To find out more about further proposed tax changes to help businesses with the impact of COVID-19 go to https://www.ird.govt.nz/covid-19-novel-coronavirus/tax-relief/tax-relief-for-businesses If you are struggling due to the impacts of COVID-19 coronavirus, we strongly encourage you to contact your tax professional to discuss how we might be able to help. This is leads ds us to, o, are we on track k with h our next xt round und of cha hang nges? The answer is yes we are on track to implement our next round of changes in April. We recognise that with the impacts of COVID-19, it is a difficult time for all New Zealanders. Inland Revenue will be working with all businesses and individuals to help them 4
through it. Maintaining the pace of IR’s transformation is important, even in these times, as we currently need to manage customers’ information across two systems. Any delay increases the risk that we won’t be able to meet customers’ needs at this difficult time. It is important to note, by moving to the new platform in line with our current plan, we increase our agility to respond swiftly to situations such as Covid-19. 4
Why we’re transforming tax administration IN CONFIDENCE It’s important to remember that these changes are part of the broader transformation of our revenue system. So before we get into the detail, let’s just briefly revisit the reasons behind the transformation. Some of you may have seen these next slides before. Inland Revenue’s transformation is a major government investment to make tax and payments simpler for New Zealanders. Everything continues to be in the mix – government policy, streamlining our processes and re-organising Inland Revenue so that we have the right people with the right skills closest to the customer. This transformation will make tax and payments simpler for New Zealanders by: • increasing voluntary compliance by having a simpler tax system • reducing compliance costs for customers, particularly small businesses • making it easier and less costly for Government to introduce policy change. The benefits we’ve committed to include: • customers will find it easier to meet their obligations and receive their entitlements • there will be a reduction in compliance costs for our customers • the revenue system will be simpler and more resilient • time and cost to implement (policy) changes will be significantly reduced 5
Our transformation 2016/17 2017/18 2018/19 2019/20 2020/21 Stage 1 Stage 2 Stage 3 Stage 4 Enable secure Streamline ta x Streamline social policy Complete the future digital services revenue system Release 3 – April Release 1 – Feb Release 2 – April Release 4 – April Release 5 – April 2019 2017 2018 2020 2021 Making it easier to Making it easier to Making it easier to Making it easier to Making it easier to manage: manage GST: manage: manage: manage: income tax file and pay at withholding taxes ▪ KiwiSaver Child support ▪ ▪ ▪ ▪ ▪ provisional tax same time ▪ fringe benefit tax ▪ Student loans ▪ Paid parental imputation amend previous gaming machine ▪ Investment income leave ▪ ▪ ▪ ▪ Working for returns duty information reporting ▪ Duties Families set-up instalment Wine equalisation (mandatory) Unclaimed ▪ ▪ ▪ arrangements and tax (WET) ▪ New R&D Tax monies Payday filing direct debits ▪ Incentive (mandatory) ▪ AIM (provisional ▪ Short process rulings ▪ Customers can Reduce PAYE NZ Business tax) ▪ Income equalisation see all their info ▪ ▪ Number Automatic electronic filing in one place ▪ threshold recognition Exchange of Further changes for Changes for ▪ Changes to Digital registration Information ▪ employers: WfFTC ▪ investment income for migrants and ▪ Payday filing ▪ Single employer information company entities (voluntary) account reporting ▪ Coordinated (voluntary) and approach to KiwiSaver notifications IN CONFIDENCE Transformation has gone from being a high-level plan at the end of 2015 to reality. It is being implemented in four broad, over-lapping stages – digital services, tax, social policy and a final wrap up. The systems, processes and legislative settings that support taxes and entitlements are being modernised in a series of releases within these stages. Major releases are occurring every year from 2017 to 2021, each one aligning with the beginning of the tax year in April. This is now well underway, with the first three releases having been implemented. The previous set of changes – Release 3 – went live a year ago. This was the largest BT release to date. We’re are now implementing Release 4. It covers a range of changes including PAYE being fully administered in our new system; and changes to the administration of KiwiSaver. We’ll talk about these, and more, today. 6
What we’ll cover today 1. Temporary shutdown over Easter 2. Changes for employers 3. KiwiSaver 4. Other changes 5. Next steps and more information IN CONFIDENCE We’ve broken the content into five sections. Here’s what we’ll cover: 1. Temporary shutdown 2. Changes for employers 3. KiwiSaver 4. Other changes 5. Next steps and more information During this we’ll be looking at changes to myIR. There are a number of things we won’t cover in detail today but we’ll point you to some great online resources to help you, including previous webinars and web content. 7
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