Reminders and important dates

Final date for "ratio option" provisional tax applications
31 March

If you want to use the ratio option to calculate your 2010 provisional tax you must apply to us by the end of March if you have a 31 March balance date.

Under the ratio option, each instalment of provisional tax is based on the earnings shown in your most recent GST return. That means tax payments are made at the same time as the business is earning its income.

GST returns must be filed every month or two months, and provisional tax is paid six times a year instead of the normal three times. Businesses adopting the ratio option avoid use-of-money interest charges on short-payments of provisional tax, provided correctly calculated instalments are paid by the due date. The ratio option can offer significant cash flow advantages, particularly to businesses with earnings that fluctuate over the course of the year.

There is more information about the ratio option in our guide A new way to work out your provisional tax (IR851) - see "Forms and guides". This guide includes information on who is eligible, calculating payments, and how to apply.

Date published: 13 Mar 2009

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