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As a result of Inland Revenue’s business transformation, a number of changes are occurring from 1 April 2020. These include changes to investment income, PAYE, including student loans and KiwiSaver, automatic assessments and myIR. Some of these changes are as follows:

Student loan changes

From April, student loan transactions will be fully administered in Inland Revenue’s new system. As a result, it will be easier for student loan customers to manage their loan and find the relevant information. In April, student loan customers will see changes in their myIR accounts including:

• a clearer view of their total student loan balance and repayments made
• a breakdown of any assessment, including amounts due and due dates
• departure and arrival dates if they travel overseas, and
• new calculators to work out how long it will take to repay their student loan or when interest will be charged when they go overseas.

New payment options are being introduced to make it easier for customers to repay their loan. Customers in New Zealand, Australia, United Kingdom (Single Euro Payments Area (SEPA)), Canada and the United States of America will be able to make payments, including extra payments on their loan, from within their myIR account. New Zealand-based customers will also be able to make credit card payments by phone 24/7.

There will also be some student loan changes for employers. The new employee onboarding process will identify if a new employee should have a student loan tax code and advise the employer to update this before their first pay.

When an employee’s loan is expected to be repaid within three months, Inland Revenue will write to the employer to let them know how much is left to deduct. This will significantly reduce the likelihood of employees having unnecessary over-deductions from their pay.

For more information on the upcoming changes for student loan customers, visit www.ird.govt.nz/changingforyou.

Kiwi Saver changes

KiwiSaver is a work-based savings initiative designed to help New Zealanders save for their retirement. From April, KiwiSaver will be fully administered in Inland Revenue’s new system. This means the processing of KiwiSaver information will be more streamlined and there will be improvements for KiwiSaver members, employers and scheme providers.

From April, KiwiSaver members will have:

• better visibility of deductions and contributions to myIR
• more self-service options in their KiwiSaver account
• more information to determine their correct PIR rate on Inland Revenue’s website, and
• their employer contributions invested sooner.

As KiwiSaver is a work-based savings initiative for most people, employers play an important role. In April, Inland Revenue’s enhancements will bring further changes for employers. Employers will:

• receive new notifications specific to KiwiSaver contribution rates and enrolments, and
• see improvements to the onboarding process for new employees.

For more information on the upcoming changes for KiwiSaver members visit www.ird.govt.nz/changingforyou.

Updating investment income allocations in myIR

From 1 April, investment income reporting is changing.

If you receive investment income, you will need to ensure that your investment income payer (eg your bank) has your IRD number to avoid being charged the non-declaration rate of 45%. If you have a joint account, Inland Revenue will split any investment income reported equally across all the joint account holders who have provided a valid IRD number to the payer. If this allocation is not correct, it can be updated in myIR.

For more information about investment income reporting changes, visit www.ird.govt.nz/investment-income.

Income equalisation schemes

The income equalisation scheme allows farmers, fishers and foresters who are eligible taxpayers to even out fluctuations in income by spreading their gross income from year to year. From April, Inland Revenue will manage income equalisation schemes in their new system.

This will mean:

• you can tell Inland Revenue about deposits and request withdrawals for income equalisation in myIR — the paper form (IR155) will be discontinued
• you can make deposits electronically in myIR or via internet banking. Use the new account code when making payments via internet banking: EQU — Income Equalisation
• all withdrawals will be paid out by direct credit
• you can see scheme balances and other transactions, such as interest, at any time in myIR under the new accounts (Income Equalisation), and
• deposits and withdrawals will be shown in your income summary and pre-populated into the “other income” field on your income tax returns in myIR.

Once the income equalisation schemes move into Inland Revenue’s new system, you will no longer need to use cheques for deposits or withdrawals. Deposits can be made using an alternative payment method and you can supply your bank account details for withdrawals.

For more information about alternative payment methods visit www.ird.govt.nz/payments.

Source: www.ird.govt.nz

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