For taxpayers who are required to pay provisional tax, Thursday, 7th May 2015, for many entities (read our post about what an entity is) is the date the 3rd Instalment of Provisional Tax for the Income Tax year 1st April 2014 to the 31st March 2015 is due. If you are unable to make this payment please be aware that in some circumstances you may be charged interest especially if the provisional tax you paid is less than your Residual Income Tax (RIT).
There has been talk recently on how the penalties mount up increasing the debt far beyond the original Provisional Tax amount owing.
Believe me when I say that through experience in dealing with clients, who have come to me as a result of not addressing their unpaid Tax, I have seen the financial hardship they have endured due to IRD Late Payment Penalties. I have also seen the health issues e.g. emotional, stress related and depression etc. not to mention the effect it has on the person’s relationships.
Don’t be like an Ostrich and “bury your head in the sand. If you are having difficulties meeting your obligations address it now and start by reading your options during financial difficulty.
I personally am at the point now that I am reluctant to take on a case where a person has ignored the advice above because if you can’t pay the IR what’s due how can you pay me to address your situation which can take a considerable length of time.
Want to never miss a Provisional Tax Payment Again?
Like all other business expenses, you have to plan ahead for your tax payments and provisional tax is no exception, so it is important to know:
- When your provisional tax payments are due, and
- How much they will be.
It’s also a good idea to use a separate bank account to put aside money to cover your provisional tax payments.
If you want to discuss this further or you have any questions please contact us.
Disclaimer: This publication has been carefully prepared, but it has been written in general terms only. The publication should not be relied upon to provide specific information without also obtaining appropriate professional advice after detailed examination of your particular situation.