AGENTSanswers - 2001

Issue 18 February 2001

Extension possible for rebate claims
Late rebate claim forms
Early rebate claim forms
New faxback features
Draft Standard Practice Statement ED-018
Duplicate debt letters
Foreign exchange rates
Late provision of information (L letter)

Extension possible for rebate claims

A number of rebate claims have been declined because the claim was outside the allowable period for those taxpayers.

The claims in question relate to taxpayers with an April or May balance date who lodged a rebate claim prior to Christmas.

The confusion may have arisen from an announcement in August last year that the Minister of Revenue would recommend that the deadline for claiming rebates relating to the income tax year ended 31 March 2000 be extended to 31 December. In fact, the legislation (as amended at the time of the October Bill) only applied to standard and early balance dates.

Section 41A(6AA) of the Tax Administration Act 1994 allows some taxpayers, in certain circumstances, to claim their rebates after the end of the claim period. Because of the apparent confusion, we consider that late rebate claim applications from taxpayers with April or May balance dates meet the criteria of a special circumstance for the 2000 income year under section 41A(6AA). Any applications that have been declined in these circumstances will be reconsidered. Tax agents are asked to contact us to ensure that we are aware of individual claims and, where possible, to provide a copy of our stock letter to make processing quicker.

Late rebate claim forms

In certain circumstances, a rebate claim form can be accepted if filed late. These include:

sickness
incapacity
being out of the country during the filing period.

A letter of explanation must accompany their rebate claim form. If the form is sent in without a letter of explanation we will send the client or tax agent a letter telling them that the claim has been made late and that we require details of the circumstances in writing.

Early rebate claim forms

For the 2001 financial year and future years, there are only two circumstances where we can accept an early Claim for a personal tax rebate (IR526) form and send out refunds.

These are where:

a taxpayer is leaving New Zealand permanently or for a significant length of time, or
a trustee of a deceased person's estate wishes to wind up the estate.

An early claim can be accepted if the customer is going overseas and will become a non-resident. The rebate claim form can be completed with a part-year tax return if the customer contacts Inland Revenue before going overseas. Alternatively, if the client has left the country already, the form can be sent back to Inland Revenue giving the date of departure, an overseas address, and a New Zealand bank account number to refund the money to.

The second situation where we would accept an early claim is when the customer is deceased and a trustee is winding up this person's estate. In this instance the form must be clearly marked "client deceased".

There are no other circumstances where the legislation allows us to process a rebate claim form early.

If Inland Revenue receives a rebate claim form that does not fit within the above criteria the claim will be sent back to the client or tax agent with a letter explaining why we were unable to process the claim at the time.

New faxback features

In the past, tax agents have been able to request an INFOexpress tax back for existing account balances and penalty and interest calculations. A new facility is being included in the current INFOexpress system allowing tax agents to request details of transactions stored in the system for a particular client, revenue type and period.

The tax enhancements are:

Details of transactions including imputation credits are provided.

Note: The imputation credit information will only appear on the detail transaction faxback, not on the account balance faxback. The fax will show all active transactions recorded for that period.
When a tax agent requests information on an account that has not been finalised, the enhancement will only display the following transactions:
- payments
- transfers
- refunds
After the last transaction the following text will be displayed:

"This account is currently under review. Only existing payments, transfers and refunds have been displayed. When the account is finalised a statement will be issued showing all transactions"

The faxback facility is being tested and should be available in early February.

Draft Standard Practice Statement ED-018

Non-standard balance dates for managed funds and "as agent" returns

This Standard Practice Statement extends operational practice relating to consent for the use of non-standard balance dates to recognise special taxpayer or administrator situations.

The exposure draft is available on Inland Revenue's website at www.ird.govt.nz

The deadline for comment is 28 February 2001. Comments can be emailed to our website or posted to:

The Manager (Field Liaison)
Adjudication & Rulings
National Office
Inland Revenue Department
PO Box 2198
Wellington

Please include your name and the name of your organisation.

Duplicate debt letters

Early last month a glitch in Inland Revenue's system resulted in some tax agents, clients of tax agents and other taxpayers receiving duplicate copies of debt letters. The system fault has now been fixed. Inland Revenue apologises for any confusion and frustration caused by the receipt of these duplicate letters. However, please note that the letters were correct in advising that a debt was owed and, if payment was made on receipt of the first letter, subsequent copies should be ignored.

Foreign exchange rates

We have had contact from a number of agents requesting foreign exchange rates. Inland Revenue publishes these rates each year on form IR270. They were also included in the October 2000 issue of the Tax Information Bulletin, Vol 12, No 10, available under the forms and guides section of our website.

Current foreign exchange rates can be obtained from trading banks.

Late provision of information (L letter)

The procedures for issuing an L letter using INFOexpress were outlined in AGENTSanswers, Issue January 2001, available under the Newsletters and Bulletins section of our website.

This service became available on 16 January 2001. Please note that there is now no provision for Inland Revenue staff to issue this letter.