Defaulting student loan borrowers in Australia have stumped up nearly $5 million in payments, thanks to new information received from tax authorities across the Tasman, Revenue Minister Judith Collins and Tertiary Education, Skills and Employment Minister Paul Goldsmith say.

An information exchange between the countries allows the Australian Taxation Office (ATO) to provide Inland Revenue with up-to-date contact details for Kiwi borrowers living in Australia.

Revenue Minister Judith Collins has welcomed a second round of negotiations between China and New Zealand tax officials aimed at updating the current double tax agreement signed between the two countries in 1986.

“The aim is to agree a new treaty, adopting modern treaty language and concepts, including agreed measures to deal with base erosion and profit shifting,” Ms Collins says.

New Zealand tax officials will meet with Chinese officials in Beijing next week for the second time since 2014, to discuss a new treaty.

Revenue Minister Judith Collins has today welcomed the release of a tax officials’ paper, seeking feedback on options to reduce the cost to employers of administering PAYE information.

“We are aware that certain aspects of PAYE, such as correcting simple errors and sending that information to Inland Revenue, are still largely manual.  This can impose excessive compliance costs on business.

Revenue Minister Judith Collins welcomed the tabling in Parliament today of the OECD-led multilateral instrument.

“The Multilateral Convention to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting (known as the Multilateral Instrument) allows several thousand tax treaties around the world to be quickly updated in line with OECD recommendations. 

Two Orders in Council signed this week will help strengthen New Zealand’s tax agreements with India, and with San Marino, to prevent tax evasion, says Revenue Minister Judith Collins. 

The Third Protocol to New Zealand’s double tax agreement (DTA) with India updates previous exchange of information provisions and inserts an article relating to assistance in the collection of taxes into the DTA.

Finance Minister Steven Joyce and Revenue Minister Judith Collins have today announced the Government’s final decisions on proposals to address base erosion and profit shifting (BEPS).

“The new measures will significantly strengthen our tax rules and our ability to ensure that multinationals are taxed fairly and on the basis of their actual level of economic activity in New Zealand,” Mr Joyce says.

In combination the new measures will:

The Government is planning major changes to how IRD pays social support so that people can know better what their entitlements are and be sure of receiving the right amount, Finance Minister Steven Joyce and Revenue Minister Judith Collins say.

“The Working for Families system is very complex and has been since it was introduced,” Mr Joyce says. “More than 40 per cent of people receiving Working for Families are underpaid, while a quarter of all people get paid too much and end up owing money to Inland Revenue.”

Revenue Minister Judith Collins has today signed a new tax protocol between New Zealand and Hong Kong.  The protocol updates the existing double tax agreement between New Zealand and Hong Kong, to allow full exchange of information on tax matters between the two jurisdictions.

Once in force, the updated double tax treaty will require both Hong Kong and New Zealand to automatically exchange tax information with each other, in line with the G20 and OECD Automatic Exchange of Information global standard.

Creditors are poised to receive greater protection from businesses owing debts of more than $150,000 as the Government has now set a threshold for reportable tax debt, Revenue Minister Judith Collins says.

Changes to the law earlier this year allowed Inland Revenue to disclose information about companies with significant tax debt to certain approved credit reporting agencies.  A recent Order in Council sets a threshold of $150,000.  A company’s tax debt over this amount may be disclosed to certain credit reporting agencies.

The Government is proposing to make tax simpler for individuals, with people whose only income is from a salary, wages or investments no longer being required to file tax returns to receive tax refunds or to calculate any additional tax.

The consultation document, Better administration of individuals’ income tax, was released today by Finance Minister Steven Joyce and Revenue Minister Judith Collins.

A new treaty signed in Paris this week is a significant step forward in the fight against base erosion and profit shifting (BEPS), says Revenue Minister Judith Collins.

"Many BEPS techniques involve tax treaty abuse. The Multilateral Convention to Implement Tax Treaty-Related Measures to Prevent Base Erosion and Profit Shifting (known as the Multilateral Instrument) allows a worldwide network of several thousand tax treaties to be quickly updated to adopt recommendations from the OECD’s BEPS Action Plan.

Inland Revenue will receive more information about US multinationals operating in New Zealand following the signing of a new bilateral arrangement with the US Internal Revenue Service to share country-by-country reports.

Revenue Minister Judith Collins says this is great news as it means Inland Revenue will have better information about how multinationals allocate profits from their operations here.

“This will further enhance Inland Revenue’s risk assessment processes to make sure that the right amount of tax is being paid,” she says.

Revenue Minister Judith Collins will travel to Europe today to represent New Zealand at a signing ceremony signifying New Zealand’s commitment to the OECD effort against base erosion and profit shifting.

Revenue Minister Judith Collins has today welcomed the start of Inland Revenue’s information campaign on the Automatic Exchange of Information (AEOI) which is part of the OECD-led effort to combat tax evasion.

From 1 July 2017, financial institutions in New Zealand will be required to identify accounts held or controlled by foreign tax residents, and collect relevant information.  This information will be reported to Inland Revenue by 30 June every year.

Revenue Minister Judith Collins has today welcomed the release of an officials’ issues paper on the taxation of employee share schemes for start-up companies.

“Employee share schemes are an important remuneration tool for start-ups as they can assist companies to both attract and retain talented staff. However, it is equally important that employee share schemes are taxed like any other form of remuneration.

Many business expenses currently written off as black hole expenditure would become tax deductible under proposals released as part of Budget 2017, Revenue Minister Judith Collins says.

“Some costs of investigating the viability of a new proposal or project – that is, feasibility expenditure – are currently neither immediately tax deductible, nor depreciable. As a result, it falls into what businesses describe as the black hole,” Ms Collins says.

More than $10 million in research and development loss tax credits have already been paid out after the first year of a scheme designed to help start-up companies access some of their tax losses sooner, Revenue Minister Judith Collins says.

Pay-outs are still being processed for the last financial year, which saw 187 companies successfully lodge applications to `cash out’ business losses associated with R&D spending.

Inland Revenue will waive use of money interest on late tax payments when flooding has prevented people from paying on time, say Lead Minister for Edgecumbe Anne Tolley and Revenue Minister Judith Collins.

“In the aftermath of the Edgecumbe and Bay of Plenty floods businesses in affected areas have enough to deal with without having to worry about their tax obligations at the same time,” Mrs Tolley says.

A new tax bill introduced into Parliament today will help modernise our tax administration while ensuring that the current system works as it should, says Revenue Minister Judith Collins.

“The Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Bill contains proposals relating to collecting employment and investment income information.  The proposals will help Inland Revenue to ensure that people are on the right tax code and receiving any entitlements correctly.”

Revenue Minister Judith Collins and Tertiary Education, Skills and Employment Minister Paul Goldsmith say they are encouraged to see a marked increase in overseas student loan defaulters contacting Inland Revenue and taking steps to pay off their loans.

Since December 2014 there has been a 66% increase in the number of overseas borrowers who are behind on their payments getting in touch with Inland Revenue.

Revenue Minister Judith Collins today welcomed Inland Revenue’s new webpage to help trustees of foreign trusts comply with the new disclosure rules.

“Foreign trusts now have to provide significantly more information than in the past. The webpage has all the information on the new rules and includes the forms which trusts need to complete in order to be registered by 30 June 2017.

A Bill  to improve and strengthen the tax rules passed its third reading today, Revenue Minister Judith Collins says.

“Building a more competitive and productive economy for New Zealanders is a priority for this Government.

“Making sure that the tax rules keep up with social and economic changes, as well as current business practices, is a vital part of a well-functioning economy.

The amount of electricity generated from renewables in New Zealand grew to 88 per cent in the three months to December 2016, building on increases seen in previous quarters, Energy and Resources Minister Judith Collins says.

“The result, released today in the latest New Zealand Energy Quarterly, shows the highest level of renewable electricity generation in 20 years. It demonstrates New Zealand is continuing to make the most of its ample renewable resources such as hydro.”

Revenue Minister Judith Collins today welcomed Inland Revenue’s decision to exercise discretions on income equalisation for farmers who are significantly affected by the recent flooding around the Franklin Ward, Hauraki District and Thames- Coromandel District.

“This step will help provide relief for those famers by giving them an option to help address the financial consequences of the flooding,” Ms Collins says.