It's important that we get New Zealanders the payments they're entitled to at the right times. We keep customers at the centre of our thinking. We focus on helping them get things right from the start, by making it simpler and easier for them to access entitlements.
We continued to support the Government's response to COVID-19, by reactivating the Resurgence Support Payment and distributing loans and top-up loans for the Small Business Cashflow Scheme. In February 2022, the Government announced that a new COVID-19 Support Payment would be available to businesses, replacing the Resurgence Support Payment.
Since the launch of these initiatives, we've:
- paid out $1.3 billion in COVID-19 Support Payments to 113,000 customers
- paid out $2.9 billion in Resurgence Support Payments to 231,000 customers
- approved $2.3 billion for the Small Business Cashflow Scheme loans, which includes $191 million for top-up loans.
Read more about our COVID-19 support.
We look at how long it takes us to issue income tax and GST refunds to customers once we receive their returns.
We have 2 timeliness targets. We met 1 and missed the other.
- Our target for issuing GST refunds is 95% within 4 weeks. We met this target, issuing 96.4% of refunds within the timeframe.
- Our target for issuing income tax refunds is 85% within 5 weeks. We just missed this target, issuing 84.4% in 2021-22.
Read more about these measures.
We look at the accuracy of GST returns that result in us issuing GST refunds.
99% of GST refunds were not amended after the initial refund.
| Year | Percentage of accurate GST returns |
|---|---|
| 2018 | 98.1% |
| 2019 | 98.8% |
| 2020 | 98.3% |
| 2021 | 98.7% |
| 2022 | 99.0% |
The accuracy of GST refunds has increased since 2020 and reached 99% this year.
This indicator is based on how automatically issued income tax assessments for individuals are making tax simpler for New Zealanders by better using the data we hold. We use the more detailed, timely and accurate information we get throughout the year to help ensure people are paying the right amount of tax, identify any changes in people's circumstances and fix any errors.
We got 2022 assessments out faster than previous years, to give customers certainty. By 30 June 2022, we had issued 3.3 million assessments to customers.
The average tax refund amount has decreased steadily between 2019 and 2021. Our preliminary 2022 figures show this year's average tax refund amount is similar to 2021. However, as the 2022 figures won't be finalised until 31 March 2023, this result may change. This year, 84% of the total tax refunded went to customers who earn less than $70,000.
The average tax to pay has increased since 2019. The increase between 2019 and 2021 is due, in part, to more income variability due to COVID-19, people being on the wrong prescribed investor rate (PIR) and us prioritising providing COVID-19 support over other work such as checking people are on the correct rates. The increase in preliminary 2022 figures is likely also due to the timing of when banks and financial institutions implemented changes for the new marginal tax rate of 39%. They had until October 2021 to do this, which meant some customers have been taxed on interest earned at a lower rate for part of the year.
| Year | Average refund | Average tax to pay |
|---|---|---|
| 2019 | $430 | $378 |
| 2020 | $394 | $458 |
| 2021 | $354 | $471 |
| 2022 (preliminary) | $364 | $522 |
Note: 2022 information is at 30 June 2022. Customers with tax agents have until 31 March 2023 to amend their 2022 assessments. 2019 information is as at 31 March 2020, 2020 information is at 31 March 2021 and 2021 information is at 31 March 2022.
We look at how long it takes us to issue the following social policy payments to customers, ensuring that they receive the payments they're entitled to in a timely manner.
- Working for Families Tax Credit (WfFTC) payments made on the first regular payment date following an application.
- Paid parental leave payments issued to customers on the first pay day following the agreed date of entitlement.
- Child support assessments paid on time.
This year we achieved all 3 timeliness targets. Read more about these measures.
We look at whether our Working for Families Tax Credit (WfFTC) customers are receiving the amounts they're entitled to to support their families.
We're aiming to improve the accuracy of WfFTC payments, by detecting changes in customers' income and adjusting their payments when necessary. Providing accurate payments during the year relies, in part, on customers giving us timely updates if their circumstances change.
Working for Families Tax Credits (WfFTCs) is complex. It includes 4 types of payments, each with different eligibility rules and abatement thresholds (the level of income at which payments start reducing). The payments depend on income and the number of dependent children in a family, and any shared care arrangements.
Overall accuracy levels have remained steady over the last 3 years, a positive result when COVID-19 has meant income has been more variable than usual for some customers. Around two-thirds of WfFTC customers received within 20% of what they should have during the year. At the end of the year, we work out how much they should have received. If they were underpaid, they get a refund, and if they were overpaid, they have a bill to pay.
| Year | Customers within 10% to 20% of their entitlement | Customers within 10% of their entitlement |
|---|---|---|
| 2020 | 13% | 55% |
| 2021 | 13% | 53% |
| 2022 (preliminary) | 12% | 56% |
Average overpayments are decreasing year on year. However, it is difficult for many customers to repay these amounts. This is reflected in the average age and growth of WfFTC debt outlined in the 'Social policy debt' information on the 'Management of debt and unfiled returns' page.
Management of debt and unfiled returns
Average underpayment levels may reflect customers intentionally overestimating their income to avoid being overpaid during the year.
| Year | Average underpayment | Average overpayment |
|---|---|---|
| 2020 | $1,338 | $1,340 |
| 2021 | $1,471 | $1,229 |
| 2022 (preliminary) | $1,287 | $1,035 |
We know it has been difficult this year for WfFTC customers to let us know about changes in their circumstances or seek reassurance that their payments are right. Because we prioritised providing COVID-19 support, more customers used digital channels to contact us compared to last year and we weren't always able to answer them quickly as we would have liked.
We continue to improve our early interventions to pick up changes to customer income that will affect their entitlements. We're also assessing what customers need to be aware of, and understand at different points in their lives, to ensure our communication and content are proactive, relevant and effective.
We continue to play an active part in the Government's Working for Families review, and wider debt to government work, to understand how the scheme can be improved to better meet the needs of families.
Note: results are for customers who receive WfFTC payments during the year. Results for 2020 and 2021 are as at 30 June 2021 and 2022 respectively, and 2022 provisional results are as at 30 June 2022, noting that a number of 2022 assessments are still to be finalised.
We know some families do not realise they are eligible to receive WfFTC. This year, we did some research to find out what customers know and understand about WfFTC, including the recent changes to some eligibility rules. From the research, we found out:
- 88% of customers who responded were aware of WfFTC. However, their awareness is much lower for the 3 tax credits in the scheme that have narrower eligibility than the 4th.
- The complexity of WfFTC affects what customers know and understand about the credits in the scheme, and their access to them.
- Fewer than 25% of customers know about recent changes for the In-Work Tax Credit to remove the set-hours criteria, and the introduction of a 2-week grace period if a family member stops work or takes an unpaid break.
- 38% of respondents know about the Best Start Tax Credit. Overall, this part of the scheme is the least well known, but families with children under the age of 5 are twice as likely to know about it.
- Customers are reasonably well aware of how WfFTC works and how it's squared up for customers who receive payments during the year rather than as a lump sum at the end of the year.
We will use what we've learnt from this research when we evaluate the recent changes to the In-Work Tax Credit and our review of the scheme. The research also informed a campaign we ran to encourage families to check if they qualify for Working for Families Tax Credits. You can read more about this.
Helping families get the payments they are entitled to
"I was only aware of one type of Working for Families Tax Credits. It'd be good if IRD could automatically calculate these for us and apply to our accounts."
"Make the information more accessible and easier to understand - very confusing about exactly what you are entitled to."
- Inland Revenue customers.