Following a 10% increase between 2022–23 and 2023–24, tax revenue grew this year by a smaller percentage (1%) to $116.6 billion.
There was also a decline in dividend withholding tax as a previous surge in dividend payments in advance of the 39 percent trustee tax rate taking effect in 2024 was not repeated this year. Most other tax types grew modestly.
IR collected $116.9 billion in tax receipts, which is 6% higher than in 2023–24. Receipts refers to the cash that was actually paid to IR to meet this year’s tax obligations or those from prior or future years.
Making tax easy
Approximately three-quarters of the tax we collected was at source, meaning the PAYE, GST and tax on interest and dividends passed on to us by employers and financial institutions. It’s cheaper to collect tax this way, more accurate and imposes a minimal compliance effort on individual customers.
In the major tax event for the year, IR sent out 3.57 million automatically calculated individual income tax assessments by 30 June 2025. This is where we finalise end-of-year income tax for customers. 85% of customers receiving an automatic assessment had nothing further to do.
IR has continued to work proactively with businesses of all sizes to help with their tax—from micro to small-to-medium-sized enterprises through to significant enterprises.
Our gateway services already play a big role in simplifying compliance for businesses with real-time accessibility, secure transactions and integration with most accounting platforms. Gateway services handled around 73% of all transactions this year, allowing customers to file returns, make amendments and send queries directly through their software, eliminating the need to use IR’s systems separately.
As you can read later in this section, we’re also continuing to proactively engage with customers with overdue GST payments and employer-related obligations as these have primarily driven an overall increase in tax debt.
Total tax revenue of $116.6 billion was made up of 4 main tax types
- Individuals tax $60.4 billion. 52% of tax revenue.
- GST $29.3 billion. 25% of tax revenue.
- Corporate tax $19.7 billion. 17% of tax revenue.
- Other tax $7.2 billion. 6% of tax revenue.
Efficient payments
In addition to collecting tax, we’ve distributed payments to families, GST and income tax refunds and KiwiSaver contributions.
IR administers Working for Families Tax Credits, paid parental leave payments, child support and FamilyBoost—$4.6 billion in tax credits and entitlements went to families across these products.
It’s essential that we distribute the right amounts and get payments to customers as quickly as possible. We achieved all performance targets for timeliness in making payments. We acknowledge that ensuring accurate Working for Families payments is more complex and we’ve made proposals to improve the scheme, as outlined on the following page.
People receive their entitlements
In the meantime, we improved online information on payments for families so it’s easier to understand eligibility, residency requirements, claiming entitlements and how to avoid getting into debt.
IR met our timeliness targets for issuing GST and income tax refund disbursements. Automated processing meant customers who were due GST refunds got them within an average of 4 days.
We also process KiwiSaver contributions from employers, employees and the Government’s annual contribution. $10.7 billion was passed to KiwiSaver service providers within 3 working days. In recognition that this is a highly efficient area of our operations, we’ve lowered the target to 2 working days from next year.
Improving the customer experience
We have found a number of ways to get more cost-effective in our core operations to complete more work, drive down costs and give customers a better service.
The upgraded voice channel introduced in 2023 is improving our ability to manage and prioritise customer calls. It’s also making new functions available such as enabling student loan borrowers to call us toll-free from more overseas locations.
We launched the myIR Navigation Assistant, a new tool that guides customers to online solutions for simple queries. It has supported 155,000 customers, with 80% of them completing their tasks independently.
IR sends around 35 million e-notifications a year to alert customers that there’s information we need them to read in myIR. These are a key ‘light touch’ compliance tool. Research showed that while most customers read them, some didn’t act, often due to unclear letter title lines. In response, we improved the wording in 80% of the titles of letters sent by email. We’ll evaluate whether these changes boost compliance through this high-volume channel.
An extension-of-time arrangement is another example of what our teams have done to help customers handle tax obligations, with less stress. We received around 15,000 requests this year. These arrangements allow customers to file tax returns later than normal, preventing late-filing penalties and supporting voluntary compliance.
In the past, customers could only be granted an extension if they contacted or visited us. Now customers can apply in myIR, saving time for them and us. This improvement was developed in less than 3 months; we’re looking at further opportunities to digitise these requests.
Overall, our efforts have meant customers’ satisfaction and perceptions of ease in dealing with IR have improved.
This includes the nearly 5,600 tax agents who support around 1.6 million clients and file close to 2 million tax returns each year. They are a vital part of New Zealand’s tax system. We’re committed to improving the services we provide to tax agents and regularly survey them to understand how we’re doing and where we can do better.
94% of the tax agents surveyed in June 2025 were satisfied with their overall experience. We saw substantial improvements in their ratings of our service delivery and consistency of advice. Their trust in IR rose to its highest level ever at 90%.
Processing timeliness
- 99.99% of paid parental leave payments were made on the first payday following the agreed date of entitlement, the same as 2024.
- 99.8% of Working for Families payments were made on the first regular payment date following an application, the same as 2024.
- 91.7% of FamilyBoost claims were processed within 10 working days.
- 97.7% of GST refunds were issued within 4 weeks (target: 95%), up from 97.1% in 2024.
- 92.0% of income tax refunds were issued within 5 weeks (target: 85%), up from 86.6% in 2024.
Customer contacts
- 78% of correspondence was completed within 10 working days, up from 65% in 2024 (target 70%).
- 75% of calls were answered (target: 60%), up from 71% in 2024.
Customer experience
- 74% of customers were satisfied with their last interaction with us, up from 70% last year.
- 69% of customers found it easy to deal with us, up from 66% last year.
- 90% of customers surveyed on our technical guidance strongly endorsed its quality (see more under Fostering certainty on tax laws, below).
Greater security of customer information
To strengthen our protection of taxpayer information, IR introduced 2-step verification for myIR accounts. This is part of our wider data and identity security efforts such as enhancing our voice validation process, which ensures the person we’re speaking to is who they claim to be.
As of June 2025, over 1 million customers have registered for 2-step verification, ahead of it becoming mandatory in October 2025.
We began rolling out 2-step verification in January 2025, initially calling selected customers to help them set it up. These calls caused confusion for some customers, who were unsure whether they were a scam. In response, we sent web messages explaining the set-up process and advising customers we’d call 3 days later to support them.
Resolving customer issues throughout the year
IR is committed to continuously improving our services based on what our customers tell us. We actively listen through a range of channels, including a research panel of 18,000 customers, real-time monitoring of customer feedback and regular surveys about their experiences with us.
Resolving issues is a constant focus. Common concerns include difficulties using our communication channels or accessing our services and disputing debts. We aim to deliver excellent service, even when customers contact us about a dispute.
This year, we also set up the ability for customers to directly rate their experience using myIR, with an average rating of 4.5 out of 5 from 100,000 submissions.
We review the results regularly, which helps us to identify clear, actionable insights we can take forward.
Customer voices
"Was my first time filing my tax return, and with the income summary provided by IRD it was really straight forward to work out and the pre-filled information was helpful. Thank you for making it stress free."
"This is my first time doing a tax credit receipt and it was really simple. Didn’t know this was the process considering I’ve donated to multiple charities over 10 years now."
"Compared to years ago I can honestly say your system is so easy to navigate and very user friendly."
"Used the phone line from the UK to get advice and help and they were very helpful and talked me through all the steps to take to update my account. Thank you."
Surge in demand for unclaimed monies
Unclaimed monies are the funds held by banks, utilities or other organisations that haven’t been accessed by their owners, and which are eventually transferred to IR. Customers can search for unclaimed monies online and submit a claim if they believe the funds belong to them.
Increased social media coverage drove a surge in claims from 2,700 in August 2023 to 45,000 by August 2024. We scaled up the small team that manages unclaimed monies temporarily—they have processed more than 80,000 claims over the past 2 years and paid out $85 million.
Reaching different audiences
IR is responsible for making every effort to ensure people know about both tax obligations and entitlements. Between our communications channels and the work our people do in communities every day, we’ve helped people and businesses understand what to do from the start. We’ve also provided targeted education and enforcement where there’s a risk that customers are off track.
Over 20 marketing campaigns ran this year to educate customers about new policies that may affect them, ensure they know about entitlements and encourage the right behaviours.
Along with our campaign promoting the new FamilyBoost scheme, we:
- alerted 18,000 Small Business Cashflow Loan borrowers that final repayment dates for many loans were looming and unpaid loans would automatically default
- reminded overseas-based student loan borrowers of their obligations and encouraged them to stay on track
- helped fringe benefit tax customers to avoid common mistakes
- directed over 100,000 customers online to learn about the bright-line rule and residential property interest limitation rules.
IR’s Tax Toolbox campaign continued to educate customers in the construction industry on taking their tax seriously. Advertising in an April to June 2025 campaign generated over 38,000 visits to our website where we take customers through record keeping, claiming expenses, GST, employer obligations and fringe benefit tax.
Use of custom audience lists on social media
Social media platforms are an important channel for us to reach large numbers of people. IR had been using custom audience lists (lists of de-identified or hashed details uploaded to social media platforms) for several years. They helped us target individual customers more accurately with information they need.
We received an unprecedented number of requests on why and how we were using these lists, and complaints. We suspended their use and carried out a comprehensive review, which identified a privacy breach in relation to one list sent to a social media platform. While this was an isolated incident, the level of public concern was sufficient for us to cease using this approach. We will continue to use social media in ways that do not require custom lists.
Working constructively with businesses
IR has worked very closely with larger corporate customers (or significant enterprises). We’ve provided real-time support, tax advice and a clearly outlined compliance approach.
Transparent on our compliance approach
IR has continued an active compliance programme for our group of significant enterprise customers. These include multinational enterprises (MNEs) based overseas and those headquartered in New Zealand.
Over the past 2 years, we’ve worked with a number of customers to reduce processing errors in their payroll and other systems that interact with ours, helping large transfers of employer information run more smoothly.
In line with increased compliance and audit activities, we’ve engaged with New Zealand’s business sector on the compliance risks we’re most focused on. We’ve made it clear that good tax governance is essential and we want larger corporates and high-wealth individuals to have effective tax control frameworks in place. In April 2025, we issued guidance on what that encompasses.
Tax governance should remain a priority for MNEs too, as we noted in an updated compliance focus document published in November 2024. The case study below has more.
We continued to encourage MNEs to reach advance pricing agreements with us. These agreements provide customers with certainty on tax for specific transfer pricing arrangements for an agreed period. In return, New Zealand gets a level of certainty that these businesses are paying the right tax for that period of time.
On 30 June 2025, 85 customers had active advance pricing agreements with IR, representing approximately $390 million in assured tax each year.
Fostering certainty on tax laws
Our Tax Counsel Office fosters compliance through providing clarity and certainty on IR’s position on tax law. This is so customers can enter commercial transactions and file returns with confidence.
We provided private rulings on areas where there are contentious tax risks—these legally bind the Commissioner and clarify how IR will treat arrangements in a particular situation.
Public advice and guidance issued this year included the following:
- We provided guidance to lessen customer uncertainties on aspects of employee share scheme rules. This includes how the rules interact with PAYE and fringe benefit tax.
- Following legislative clarification of land taxing rules and GST apportionment rules, IR updated 2 well-used tranches of public guidance on short-stay accommodation and application of the bright-line test. This will make compliance with the current rules easier by removing uncertainty arising from previous law changes in this area.
- IR published a comprehensive interpretation statement on the tax treatment of partnerships (including limited partnerships). This guidance documents the Commissioner’s view of tax law as it applies to partnerships and will be an enduring resource for advisers.
Overall, the technical guidance provided by the Tax Counsel Office continues to be rated highly by customers. A November 2024 survey found nearly 90% of respondents strongly endorsed the quality of analytical review and guidance we provided. Customers also appreciated IR’s public consultation process and willingness to engage in open dialogue on tax technical issues.
Our compliance strategy for multinational enterprises
Multinational enterprises (MNEs) contribute a significant amount to New Zealand’s corporate tax base. IR monitors approximately 800 companies, using a comprehensive strategy to ensure strong compliance outcomes.
As global business grows more complex, we’ve strengthened our international engagement and adopted best practices. Over the past 5 years, we have:
- embedded measures to counter base erosion and profit shifting (BEPS)
- expanded intelligence through enhanced domestic and international information-sharing
- played an active role in global tax initiatives
- met OECD peer review standards, reinforcing our international credibility.
An update of our compliance document for MNEs in November 2024 provides transparency about our compliance focus, including:
- our compliance framework and international tax strategy
- key compliance drivers and international standards
- progress on the OECD’s Two Pillar Solution and global mobility project
- our risk assessment process and data sources.
We’ve also introduced tools to support compliance, including a revised tax governance checklist and risk barometer for boards and updated risk indicators.
MNEs have engaged constructively with us, with a 100% response rate to annual questionnaires we’ve sent them over the past 5 years. Their input has shaped our campaigns and helped reduce their compliance costs.