Tax Updates: 13 May 2024

Welcome to this week’s review of tax issues where Richard comments on what’s been happening in the world of tax over the past week. If you have a question or would like a second opinion on any national or international tax issues, please contact Richard via email at [email protected].

Electronic filing exemption

Inland Revenue (IR) has issued a draft operational statement surrounding granting exemptions from the requirement to file returns/information electronically – specifically applications relating to sections 23G, 25P and 36BD (3) of the Tax Administration Act 1994.

These three sections apply to the following groups of persons:

• An employer included in the online group of employers (gross amounts of tax payable for the preceding tax year exceeded $50,000).

• A GST-registered person who exceeds the statutory threshold for filing returns electronically (presently, there is no threshold).

• A person who makes a payment of investment income (electronic filing required).

The draft is ED0255. It’s a seven-page document that essentially repeats the existing OS 19/01 (which it will replace) but is updated to reflect amended legislative references.

As the old saying goes, ‘the devil is in the detail’; however, certainly not in the case of the present document. An exemption may be granted under one of the aforementioned sections if it is reasonable in the circumstances (fact specific to the applicant’s individual circumstances), taking into account:

• The nature and availability of digital services to the person, including the reliability of those services for the purposes of the person.

• The capability of the person relating to the use of computers.

• Whether the costs that the person would incur in complying with the legislation’s requirements would be unreasonable.

The discussion part of ED0255 briefly (and I mean briefly) discusses each of the three consideration points. Basically, if you’re a farmer in the Wild West with no access to the Internet, an exemption will likely be granted to you.

So, unless you have nothing better to do during your morning cuppa, it’s not worth the read, in my humble opinion. However, if you do and feel the need to comment on the draft, you must do so no later than May 28.

This article was originally published through the ‘A Week In Review’ newsletter. If you would like to receive Richard’s tax updates every Monday morning, you can subscribe here.