It is proposed that Inland Revenue receives information about each recipient in the month following the month in which the income is paid, instead of after the end of the tax year. Due dates for filing returns and making payments will remain the same:
- the 20th of the following month for resident withholding tax (RWT), non-resident withholding tax (NRWT) and the approved issuer levy (AIL) scheme, and
- the end of the month for portfolio investment entities (PIEs).
The only difference is that information about individual taxpayers will also be required at this time, rather than just summary information.
PIE funds would provide information they already hold more often
Because a PIE needs to pay tax when an investor exits, the majority of PIEs attribute income to investors every day. So requiring PIEs to report investors’ income details and prescribed investor rates (PIRs) monthly would simply be asking for information they already hold. Filing dates would remain the same, i.e. the end of the month.
PIE income that is “locked in”, such as income from KiwiSaver funds and complying superannuation funds with withdrawal restrictions, isn’t included in income calculations for social policy purposes, so this income may not need to be reported as frequently. For locked in funds it is proposed that PIE funds provide reporting on investors’ details perhaps quarterly or six-monthly, so Inland Revenue could determine whether the investors were on the correct PIRs.