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IRD - interest certificates and cheques now gone 16 Jul 2020

From 1 April 2020, banks have not been required to provide their customers with year-end interest certificates.

This is because Inland Revenue is collecting this information and it’s available on their website. The only catch is where a client does not supply their IRD number. In this case, they will be taxed but it won’t show up in My IR.

What if the interest is on a joint account? Inland Revenue will assume joint investments are split equally between joint account holders who have provided their IRD numbers. You will be able to go into “My IR” and alter the allocation of the interest. Alternatively, it can be fixed when your tax return is put in.

From 1 March, 2020, Inland Revenue will no longer accept cheques. However, you could pay your tax using a debit or credit card.

If you do this, Inland Revenue proposes charging a convenience fee of 1.42%. While this might seem expensive and it is, it could be useful for the person who has a short-term cash flow problem and cannot pay tax on time. If this person is expecting money to come in before the deadline for paying the bank, it might be worth the cost.

Even if the money is late, and you have to pay interest to the bank, the convenience of being able to arrange the finance quickly, when compared with the time you would have to put in negotiating a loan from the bank – or if this was not possible, spread payments with Inland Revenue – could still be worthwhile.

Paradoxically, payments into the income equalisation scheme have still got to be made by cheque until Inland Revenue can find an alternative.

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