If you are still making payments by cheque, you would be no longer required to pay the duty of five cents per cheque.
Inland Revenue Department (IRD) has announced the removal of the duty on cheques with effect from July 1, 2014.
The Department says that payment through cheques has become outmoded but companies and individuals still issue thousands of cheques ever year for making payments to suppliers and others.
“Cheque duty is being repealed because it no longer raises substantial revenue. Cheques printed or issued after June 30, 2014 may carry the notification, ‘Cheque Duty Paid.’ They can be used even though duty has not been paid,” an IRD notification said.
Duty on bills of exchange has also been revoked effective July 1, 2014, except in cases where the duty has been prepaid.
Changes to Payment Options
IRD is also making changes to payments from October 1, 2014.
Customers will not be able to make cheque payments on drop-off returns and forms at Westpac Bank. They can however continue to make cash and EFTPOS payments at Westpac, use online banking, credit or debit cards, make international money transfers and post cheques to the Department.
“However, cheque payments must arrive (from October 1) on or before the due date to avoid interest and late payment penalties. More than 70% of payments are currently made online and we want to encourage more customers to pay online. Removing the unintended advantage to customers who post cheque payments on the due date enables us to treat all customers equally regardless of their payment method,” the notification said.