1 March 2013
Dunne: Northland drought tax relief announced
Revenue Minister Peter Dunne today welcomed Inland Revenue’s decision to exercise its income equalisation discretions to help provide relief for Northland famers hit by the current drought.
Primary Industries Minister Nathan Guy officially declared a state of drought in Northland on Wednesday.
Mr Dunne said that he fully appreciates that farmers will have other more urgent issues on their minds than tax right now.
“But this is important for farmers who, because of the very dry conditions this summer, are likely to face financial difficulties either in this financial year or next,” he said.
The income equalisation scheme allows farmers to better manage peaks and troughs in their income by allowing money to be put aside from a better year and withdrawn against a not so good year.
Inland Revenue has decided to relax these rules by allowing late deposits from the 2012 income tax year to be made up to 30 April this year, regardless of when the 2012 tax return is filed or the due date for filing that return. Also early refunds will be allowed.
Mr Dunne said that this would mean that farmers will be able to better plan their financial response to the drought conditions.
“Given the dry conditions across the North Island, I imagine that drought events will be declared in other areas. If that is the case then I would expect that similar Inland Revenue announcements will be made for those areas too,” he said.
“I think everyone has real sympathy for affected farmers and people generally when hit by incredibly difficult natural events over which they have no control. While there are many things they need to do as a result, one of them is consult their accountants to consider whether this relief will be helpful in their specific situation.”
Details of the Inland Revenue response for Northland farmers affected can be found at www.ird.govt.nz
Mark Stewart | Press Secretary | Office of Hon Peter Dunne
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