Tax responsibilities for people receiving taxable income

You may receive taxable income through employment, a business, rent, a benefit or superannuation, or other income that is taxed at source (before you receive it). Here we outline what to do:

• to ensure you pay the correct amount of tax on your taxable income
• when you receive income from rent or a business in particular
• when you have a student loan.

How to pay the correct amount of tax (not too much, not too little)

When you receive income from your job or other taxable income:

• Give your IRD number to your boss or other payer. If you don't have an IRD number, fill in an IRD number application - individual (IR595) form.
• Fill in a Tax code declaration (IR330). For help choosing the correct tax code, use our work out your tax code decision tree.

To work out how much tax will be deducted from your employment earnings, use the PAYE/KiwiSaver calculator - go to "Work it out" . Note that this calculator does not take account of any other income you may receive, for example from interest.

If you are in employment for part of the year only, you could be entitled to a tax refund. You can check whether you are entitled to a refund by using the Personal tax summary calculator - go to "Work it out".

Receiving income from rent or business?

When you receive rental or business income, you must:

• keep records
• send your Individual tax return (IR3) to us after each financial year.

See our business section for more detail on what tax you must pay and what expenses/deductions you may claim when you are running a business.

Independent earner tax credit (IETC)

From 1 April 2009 eligible tax payers earning between $24,000 and $48,000 will be entitled to the IETC which will lower the amount of tax to pay. Find out more information on the IETC.

When you have a student loan

You must start repaying your student loan when you start earning over the student loan repayment threshold. For the 2010 tax year the threshold is $19,084. Even if you go overseas for a holiday or the longer term, you must continue to repay your student loan.

You can repay your student loan by:

• Automatic deductions from your salary or wages, which are set at the minimum repayment amount of 10 cents in every dollar you earn over $19,084. You begin this process by indicating the student loan tax code that applies to you in your Tax code declaration (IR330) .
• Additional voluntary repayments at any time. This is a good way to pay off your loan faster.

Find out more

• Income tax basics: tax rates and tax codes
• Personal tax summaries, tax returns and rebates
• Work out if you need to do anything at the end of the tax year (31 March)
• Learn more about student loans
• Learn more about child support
• Learn more about working for families tax credits

Date published: 24 Mar 2009

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