Over the coming months, IRD will be reaching out to businesses that have significant outstanding tax debt. These are businesses that have not engaged with the IRD despite receiving multiple reminders and warning notices. If you’re one of these businesses, then you must connect with IRD so they can understand your circumstances and work with you on a solution.
During COVID-19 IRD’s primary focus was supporting businesses through these challenges. But now, they’re shifting their attention to helping customers with outstanding compliance obligations.
Struggling with Tax Debt?
If you have overdue tax debt, it’s best not to bury your head in the sand. Your debt isn’t going to go away. If you’d like to speak to an expert before you contact the IRD, then get in touch. I can offer tailored advice for your situation before your debt escalates. Here are some tips to help you get that tax debt under control.
Payment plans: The Inland Revenue Department (IRD) offers flexible payment plans that make debt payments more manageable. These plans can be tailored to your cash flow, ensuring you can meet your obligations without undue stress.
IRD is reasonable: Contrary to common perception, the IRD is reasonable and willing to work with businesses facing financial difficulties. They understand that these circumstances can be challenging but are more likely to assist if they understand your circumstances.
Be aware of what you owe: Keeping track of your tax obligations will help you avoid getting into debt in the future. I recommend setting up a process that records your transactions, such as accounting software. Regularly reviewing your accounts will ensure you know what you owe so you can avoid surprises.
Penalties and interest: Be mindful of the penalties and interest that can accrue on overdue tax amounts. Addressing your debt sooner rather than later can prevent these additional costs from escalating.
How can a Bookkeeper Help?
Here’s a little-known secret! Tax agents (bookkeepers and accountants) can often get an extension to file your income tax return until the following March. This takes the pressure off the July deadline and gives you more time to get your paperwork together.
Remember a tax agent is actually a business expense and is therefore tax deductible, which contributes to a reduction of your overall tax bill.
We’ll help you simplify your financials by getting them set up with an accounting software programme, like MYOB or Xero.
We’ll do a full reconciliation of your financials to get a better understanding of your debts or creditors and anything that might be outstanding.
We’ll prepare a monthly account report to keep you up to date with how your business is performing.
We can ensure that you comply with all Inland Revenue obligations including GST, PAYE and Fringe Benefits Tax.
Whatever industry you’re working in, handing over your financials to a bookkeeper can allow you to get back to the stuff you enjoy doing and the reason you started that business in the first place.
So, don’t bury your head in the sand about overdue tax debt. Contact me for a free 30-minute no-obligation chat and let’s get it sorted!
