myIR, payments and more
If you want to use the ratio option to calculate your provisional tax and have a 31 March balance date you need to apply to us by the end of March.
Under the ratio option:
- Each instalment of provisional tax is based on the earnings shown in your most recent GST return - so tax payments are made at the same time the business is earning its income.
- GST returns must be filed every month or two months.
- Provisional tax is paid six times a year instead of the normal three times.
- You can avoid use-of-money interest charges on short-payments of provisional tax, provided you have paid correctly calculated instalments by the due date.
- There are significant cash flow advantages, particularly to businesses with earnings that fluctuate over the course of the year.