Slide 1
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Title: Best of the rest webinar
Subtitle: Changes coming in 2026
Audio
Kia ora everyone and welcome to this webinar. My name is Helen Mitchell and with me today is Vicki Cronin. We are Relationship Managers at Inland Revenue.
Slide 2
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Nau mai, Haere mai, Welcome
Topics:
- Financial arrangement rules
- Credit reporting formal notification requirements
- Managing customer contact details
- Confirmation of payee
- Best Start
Audio
This webinar is our Best of the Rest session. We’ll cover the following topics: financial arrangement rules, credit reporting formal notification requirements, managing customer contact details, confirmation of payee, and Best Start.
Please note: the information in this presentation is current as at 2 March 2026 and may be subject to change. We’ll start by looking at the financial arrangement rules.
Slide 3
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Title: Financial Arrangement Rules
Subtitle: Cash basis thresholds
Body text:
Cash basis thresholds table (current value, updated value, effective from):
- Income and expenditure: $100,000 or less → $200,000 or less (2025–26 income year)
- Absolute value: $1,000,000 or less → $2,000,000 or less (2025–26 income year)
- Deferral: $40,000 or less → N/A (1 April 2026)
Threshold updates for variable principal debt instruments table:
- Variable principal debt instrument: $50,000 or less → $100,000 or less (2025–26 income year)
Audio
The financial arrangement rules are being updated to help ensure the rules remain fair, relevant, and proportionate to the tax impact.
For those using the cash basis, the thresholds are set to increase from the 2025–26 income year. Income and expenditure limits will rise to $200,000, and the absolute value threshold will move up to $2,000,000.
The deferral threshold for cash basis persons will be removed from 1 April 2026, making the criteria easier to apply.
Starting from the 2025–26 income year, the threshold for treating variable principal debt instruments—like overdrafts—as excepted financial arrangements will double from $50,000 to $100,000. Updating these thresholds will help ensure the rules remain fair, relevant, and proportionate to the tax impact.
Slide 4
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Title: Financial Arrangement Rules
Subtitle: Additional changes
Body text:
- The deferral threshold will be removed from cash basis person thresholds.
- ‘Absolute value’ calculations will exclude foreign exchange rate changes; NZD value set at the start of the arrangement.
- Companies will no longer be able to treat variable principal debt instruments as excepted financial arrangements.
Audio
Further changes are being introduced to simplify the financial arrangement rules.
The deferral threshold for cash basis persons will be removed, making the criteria easier to apply.
When calculating the absolute value, foreign exchange rate changes will no longer be included; instead, the New Zealand dollar value will be set at the start of the arrangement.
Additionally, companies will no longer be able to treat variable principal debt instruments as excepted financial arrangements, ensuring consistency across taxpayers.
Slide 5
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Title: Updates to credit reporting formal notification requirements
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Reasonable Effort Guidelines
- Reasonable effort is now satisfied if at least two automated overdue tax letters have been sent to the company, including notices sent via myIR.
- Direct contact with the customer, such as discussions with the company directors or tax agents, is no longer required.
Formal Notification
- Notice of Intention (NoI) no longer needs to be served on all directors, only to the company itself.
- Note: The updated notification and reasonable effort criteria are already in effect.
Delivery Methods
- From April 2026, Inland Revenue will be able to send formal notification by electronic means (myIR) or standard post.
- Inland Revenue is exploring options to extend this information sharing to other approved credit reporting agencies.
Audio
Inland Revenue has reviewed and withdrawn previous guidance about information sharing with approved credit reporting agencies, and the following changes have been made:
Reasonable Effort Guidelines
To support more efficient credit reporting, “reasonable efforts” to recover debt from a customer have been reviewed and updated, so that:
- Reasonable effort is now satisfied if at least two automated overdue tax letters have been sent to the company, including notices sent via myIR.
- Direct contact with the customer, such as discussions with the company directors or tax agents, is no longer required.
Formal Notification
Notice of Intention (NoI) no longer needs to be served on all directors, only to the company itself.
Note: The above updated notification and reasonable effort criteria are already in effect.
Delivery Methods
From April 2026, IR will be able to send formal notification by electronic means (myIR) or standard post.
We are also exploring options to extend this information sharing to other approved credit reporting agencies.
Slide 6
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Title: Best Start
Subtitle: Income-testing changes
Body text:
- Best Start will be income-tested from the first year of entitlement from 1 April 2026.
- 21% abatement rate applies for family scheme income over $79,000 from year one.
- Babies born before 1 April 2026 are still eligible for full Best Start in the first year.
Applying for Best Start
- If a first child is born before 1 April and the application is made after that date, it must be made directly with Inland Revenue.
- For babies born on or after 1 April 2026, applications can be made through DIA’s SmartStart if the family is already registered for Working for Families; otherwise they need to apply directly with Inland Revenue.
Audio
From 1 April 2026, there will be a significant change to Best Start tax credit. It will become income-tested from the very first year of entitlement - this brings it in line with how Best Start is already assessed in years two and three. The 21% abatement rate for family scheme income over $79,000 will also apply from the start of year one and continue through years two and three.
For babies born before 1 April 2026, customers will still be eligible for the full amount of Best Start in the first year of their child’s life.
How someone can apply for Best Start, will depend on whether it is their first child, and when their application is made.
If a first child is born before 1 April and the application is made after that date, it must be made directly with Inland Revenue, they will not be able to apply through DIA’s SmartStart.
For babies born on or after 1 April 2026, applications can be made through DIA’s SmartStart if the family is already registered for Working for Families, otherwise they need to apply directly with Inland Revenue.
Slide 7
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Title: Unclaimed money
Subtitle: Changes to the regime
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From 1 April 2026:
- The time bar for a claimant to claim unclaimed money before it becomes unable to be claimed will reduce from 25 years to 20 years.
- Holders of unclaimed money will need to provide more detailed information when transferring funds to Inland Revenue.
- Customers now need to log in to myIR to submit an unclaimed money claim online.
Audio
From 1 April 2026 there will be some changes to the Unclaimed Money Regime.
The first change is that the time bar for a claimant to claim unclaimed money before it becomes unable to be claimed will reduce from 25 years to 20 years.
The next is that holders of unclaimed money will need to provide more detailed information when transferring funds to Inland Revenue. This will help ensure accurate records and faster processing of claims.
We’ve also recently made a change which means customers now need to log in to myIR to submit an unclaimed money claim online. Those without an IRD number will need to contact Inland Revenue to obtain a customer identifier before creating a web logon. Authorised people can use their own myIR to claim on behalf of a third party.
Slide 8
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Title: Additional changes
Subtitle: Overview
Body text:
Working for Families – effective 1 April 2026
- Family Tax Credit (FTC) entitlement threshold increasing for eldest and subsequent children
- The Working for Families abatement threshold is increasing
- The Minimum Family Tax Credit (MFTC) threshold is increasing
- Best Start Tax Credit entitlement increase RDTI
- The due date for RDTI general approval applications for September balance dates will move to 15 January.
Audio
There are some additional changes that may be of interest to you. The 1 April 2026 Working for Families changes
- The Family Tax Credit entitlement for the eldest child will increase to $7,921 per year, and the subsequent children entitlement will increase to $6,454 per year.
- The working for families abatement threshold will rise to 27.5%
- The minimum Family Tax Credit threshold will increase to $36,604 after tax per year or $703 after tax per week, and
- The Best Start entitlement increases to $4,041 a year, or $77 per week.
RDTI: General approval application due date extension for September balance dates
The due date for RDTI general approval applications for September balance dates will move to 15 January. This avoids the previous 31 December deadline during Inland Revenue’s holiday close-down period, ensuring support is available when applications are submitted.
Slide 9
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Title: Additional changes
Subtitle: Annual ACC levy and student loan updates
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Student loans:
- The annual and daily interest rates are increasing.
- The late payment interest rate is increasing.
- For customers on a reduced late payment rate, the annual rate is increasing.
ACC:
- The ACC earners’ levy is increasing.
Audio
ACC levy and student loan updates
For Student Loans: The annual interest rate is increasing to 5.6%, up from 4.9%.
The daily interest rate increases to 0.01534%, up from 0.01342%.
The late payment interest rate, charged annually, increases to 9.6%, up from 8.9%, and the monthly rate increases to 0.766%, up from 0.713%.
For customers on a reduced late payment rate, the annual rate increases to 7.6%, up from 6.9%, and the monthly rate increases to 0.612%, up from 0.557%.
The annual repayment threshold, significant over deduction threshold and administration fee have not changed.
For ACC the earners’ levy is increasing to 1.75%, up from 1.67%.
Slide 10
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Body text:
- A closing message thanks viewers
- Text “Ngā mihi maioha” appears
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That brings us to the end of our webinar. If you want to find out more about the other webinars available for April Release 2026, go to www.ird.govt.nz/april-release
Thank you for watching.