Date posted: 18/11/2016 4 min read

More details needed on impending NZ tax transformation - survey

Nearly seven in 10 public practice CAs surveyed have doubts about taxpayers' readiness

Chartered Accountants believe Kiwi taxpayers need more information about Inland Revenue’s upcoming transformation of the way tax is paid.

The 2016 survey of Chartered Accountants’ satisfaction with Inland Revenue (IR), released in November, also reveals concerns about increased use of technology to provide real-time tax information to IR.

The IR Satisfaction Survey, commissioned by Chartered Accountants Australia and New Zealand and Tax Management NZ, asked Chartered Accountants (CAs) in public practice and corporates for their views on IR’s new tax administration system – called Business Transformation – along with some of the business tax changes currently before Parliament.

Nearly seven in 10 public practice CAs surveyed have doubts about taxpayers’ readiness for Business Transformation, says Chartered Accountants ANZ New Zealand Tax Leader Peter Vial.

“These views are from the coal face of the tax system as many CAs in public practice work with small and medium-sized businesses.”
Peter Vial, New Zealand Tax Leader, Chartered Accountants ANZ

Respondents also raised concerns about providing real-time information to IR and taxpayers’ financial systems ‘talking’ directly to IR’s systems. They are worried about how accurately taxpayers will input information and their lack of access to compatible technology.

Chartered Accountants in both public practice and corporates want more information about Business Transformation from IR.

Business Transformation aims to simplify and streamline IR’s business processes, policies and customer services as well as upgrade its technology. Changes will be introduced incrementally from next year.

AIM questions

The survey also asked Chartered Accountants ANZ members about the new provisional tax calculation method, the accounting income method (AIM).

Tax Management NZ Chief Executive Chris Cunniffe says more may be required to encourage uptake of AIM after less than 50 per cent of respondents indicated they would use the method when it comes into effect on 1 April 2018.

Under AIM, taxpayers with turnover of less than $5 million, and who use IR-approved accounting software, will be able to pay provisional tax every two months based on profit for that period.

“While most Chartered Accountants agreed that AIM would provide certainty around provisional tax, they are less certain that it will reduce compliance costs,” says Mr Cunniffe.

In terms of overall satisfaction, the number of CAs who have had a positive experience when dealing with IR in the last 12 months has increased by 2 per cent. However, this has been offset by a 2 per cent increase in those who have had a less than positive experience.

As was the case last year, respondents would like IR to improve the consistency of information provided by its call centre staff and the ease of finding the right person to talk to about a technical issue.

The areas of audit and processing showed significant improvement.

Satisfaction with Inland Revenue

Read the Satisfaction with Inland Revenue November 2016 survey

Read more

Search related topics