Tax Updates: 9 June 2025

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 richard@gilshep.co.nz.

2025 mileage rates published

Inland Revenue (IR) has recently published the vehicle kilometre rates, which can be used to calculate expense deduction claims for the 2024–2025 income year. One change you will notice this year is that, rather than having a single Tier One rate for all vehicle types, a rate has been set for each vehicle category to ensure the rates accurately reflect reasonable expenditure related to the business use of that particular vehicle. This is due to a significant difference in vehicle running costs between the different vehicle types (Petrol, Diesel, Petrol Hybrid and Electric).

The Tier One rates apply to total distance covered in the vehicle for the year up to 14,000 kilometres, with the rates being applied to the business use proportion in that regard. Where the total distance covered exceeds 14,000 kilometres for the year, then the Tier Two rates should be used for the business portion of the excess.

The 2024/25 rates are:

The rates are published in OS 19 04 (KM 2025): “Kilometre rates for the business use of vehicles for the 2025 income year,” and if you want to learn more about how to use the rates correctly, you can refer to either OS 19/04a, “Commissioner’s statement on using a kilometre rate for business running of a motor vehicle – deductions,” or OS 19/04b, “Commissioner’s statement on using a kilometre rate for employee reimbursement of a motor vehicle.” OS 19/04 does contain a few simple examples to illustrate the potential use of the rates in different situations.

Specified Livestock Values published

For those of you who have clients in the business of livestock farming, IR has recently published NAMV 2025 – National Average Market Values of Specified Livestock Determination 2025, which should be applied to specified livestock on hand at the end of the 2024-2025 income year.

Section EC 15 of the Income Tax Act 2007 (ITA07) requires IR to make a determination declaring the national average market values (NAMV) for an income year for each class of specified livestock set out in Schedule 17 of the Act – which includes the likes of sheep, beef and dairy cattle, deer, goats and pigs.

NAMV’s are declared for an income year and used by taxpayers who are in the business of livestock farming, to value any specified livestock that they have on hand, where the taxpayer has elected to use the herd scheme to value that livestock in the income year.

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.