Date posted: 16/11/2017 8 min read

Chartered Accountants want training from IR ahead of tax system changes

Chartered Accountants rate their happiness with Inland Revenue, and training for Business Transformation, in latest CA ANZ IR satisfaction survey

IR Satisfaction Survey

Three quarters of survey respondents rated their experience with IR as good, very good or excellent in latest IR Satisfaction survey

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Issues experienced with GST changes earlier this year have prompted Chartered Accountants to request more training from Inland Revenue (IR) ahead of the implementation of the new income tax system, the latest Satisfaction with IR survey released today [16 Nov] reveals.

The annual survey, commissioned by Chartered Accountants Australia and New Zealand (CA ANZ) and Tax Management NZ (TMNZ), asked CA ANZ members in public practice and corporates for their views on IR’s new tax system – called Business Transformation – and provisional tax changes.

Chartered Accountants say that, at least six months before the launch of the new income tax system, IR should have its staff trained and be offering online user training to taxpayers and tax agents, notes John Cuthbertson, New Zealand Tax Leader for CA ANZ.

Most respondents also wanted in-person training closer to the go-live date.

“But the clock is ticking on Business Transformation,” says Cuthbertson, as IR prepares to roll out a series of changes to other taxes in 2018 and 2019, starting next April.

“There have been frank and constructive discussions between users and IR, resulting in members’ involvement at the preliminary testing phase and adjustments to the timetable for migration of income tax.”

Most members (60 percent) believe that filing GST returns in myIR was now working well and IR’s response to feedback on the new system was good.

That, says Cuthbertson, bodes well for future system changes under Business Transformation.

“We expect that the learnings IR has taken from the myGST roll out will make for a smoother transition of other tax types.”

Provisional tax and AIM

Three-quarters of respondents in public practice believe their clients will be better off due to the recent provisional tax changes. Those in the business sector were less likely to believe this would be the case (36 percent).

TMNZ Chief Executive Chris Cunniffe says it’s not surprising the changes have generally been well received given the removal, or significant reduction, in IR interest exposure for taxpayers with seasonal or uncertain income.

“Before the changes, taxpayers were paying interest from an earlier date. Now, under certain provisional tax calculation methods, interest will not be imposed until after year end. This makes it easier for taxpayers to manage their tax and interest liabilities.”

The survey suggested that IR had much work to do to convince members of the benefits of AIM, the new provisional tax calculation method coming into force from 1 April next year.

While most respondents agree AIM will provide more certainty around provisional tax, only 24 percent of those in public practice say some of their clients would use AIM, down from 38 percent last year. Less than half believe it will reduce compliance costs, says Cunniffe.

“AIM is IR’s flagship development, but it appears that practitioners are cautious about adopting it.”

Members’ experiences contacting IR

Cuthbertson says that over three quarters rated their experience with IR as good, very good or excellent.

“This is a very good result for IR considering the scale of change that they are implementing.”

Phone calls with IR are a work in progress. Obtaining general information by phone remains the least positive experience for CA ANZ members with 69 percent of survey respondents rating phone calls good or better compared with 85 percent for other contact options for general information.

“Problem areas include getting consistent information from different IR staff, the length of time until the phone call is picked up and finding the right person,” says Cuthbertson.

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