Apart from writing a regular monthly column, Inland Revenue Department (IRD) Community Relationship Advisor Abdul Rafik answers Readers’ Queries. Here are two of them:
Evading Tax Agent
I had engaged a Chartered Accountant to file my returns for the past 15 years. He recently merged with a larger firm and continues to work from there. However, he has not filed my returns for the financial years 2009-2010 and now 2010-2011 is also due. I have given him all my files. Will I be penalised for his fault? He does not answer my calls.
Even though you have engaged an accountant to prepare your tax returns, you are ultimately responsible for ensuring they are filed with IRD by the due date.
When an accountant joins a new firm, some of his or her clients can be allocated to other members of the firm. This may have happened in your case, and it could explain why you are not getting a response to your phone calls.
I suggest contacting the firm itself (rather than your accountant) and asking them if you can talk to the person looking after your tax affairs. You may find a new person is busy familiarising themselves with your file.
If it appears your tax returns have not been progressed, you could ask for your records back, and go to a new accounting firm.
As a last resort, you could lay a complaint with the New Zealand Institute of Chartered Accountants, provided your accountant is a member. You can check the list of members at www.nzica.com under Employ an accountant/Find an accountant.
Non-Filer
Who is a ‘Non-Filer?’ Who qualifies to be on this status?
‘Non-filer’ is a term used to describe someone who does not need to file an income tax return. You need to file an IR3 return if you earned income other than salary, wages, interest, dividends, and/or taxable Maori authority distributions.
Other income includes rental income, self-employed or business income and overseas income, more than $200 of scheduler payments (formerly withholding payments), estate, trust or partnership income and income without PAYE deducted, such as shareholder-employee salary.
Most people who earn salary or wages and pay the correct amount of tax, do not have to do anything at the end of the tax year. But if we believe you need to square up your tax, we will send you a Personal Tax Summary by mid-July.
You may like to request a Personal Tax Summary in July if you think you are entitled to a tax refund.
You may get a refund if you worked while at school, worked for part of the year, received a lump sum payment (such as a bonus or redundancy), earned less than $9880 or had more than one employer during the year.
You may also get a refund if you have expenses to claim and were entitled to the Independent Earner Tax Credit but did not claim all of it during the tax year.
Visit our website www.ird.govt.nz for more information on each of these topics.
Follow the links such as Individuals & families/Income tax/What to do at the end of the tax year (March 31).
