Why smart kiwi businesses are making the switch to TMNZ.
For over 20 years, TMNZ has been helping New Zealand businesses manage their provisional tax more effectively. Yet many SMEs still have questions about how it works and whether it’s right for them.
We sat down with Joe Kettlewell, Customer Growth Manager at TMNZ to address the most common concerns we hear.
Is tax pooling actually legit?
Absolutely. It’s has been part of New Zealand’s tax landscape for more than two decades. All tax pooling intermediaries, including TMNZ, use trust accounts directly linked to the IRD. This means your funds carry crown risk – the lowest risk level possible.
When you deposit funds into a tax pool, it’s essentially the same as paying the IRD directly. The IRD fully supports this provisional tax payment method because it helps businesses stay compliant by ensuring the right amount of tax is paid at the right time.
I’ve always paid the IRD directly – why change now?
There are two main reasons to consider TMNZ’s provisional tax solutions, even if you’ve never had payment issues before:
- Future-proof your business: Cashflow consistency today doesn’t guarantee tomorrow. Whether it’s seasonal dips, unexpected expenses, or market changes, having TMNZ set up means you’re ready to respond quickly if circumstances change.
- Take control of your tax: When you overpay the IRD, they might allocate your surplus to other tax types without consulting you. With TMNZ, your funds remain ringfenced and under your control. Need a refund? You can typically get surplus funds back within a week, rather than waiting months for the IRD to process your request.
My accountant handles everything – do I need to get involved?
The beauty of TMNZ’s provisional tax solutions is the flexibility. If your accountant manages your tax affairs, they can engage with TMNZ on your behalf – in fact, we’re endorsed by major consultancy firms and accountants across New Zealand.
For businesses with in-house tax teams, we provide hands-on support. We’ll review your historic myIR statements, understand your income patterns and seasonality, and recommend solutions that smooth out your provisional tax obligations throughout the year.
Isn’t it just for big corporates?
This is perhaps the biggest misconception. While large enterprises certainly benefit from deferring provisional tax payments for capital expenditure or better returns, the majority of our clients are actually small to medium businesses.
From hairdressers to tradies, any business with income fluctuations finds TMNZ invaluable. You can pay as much or little as you want throughout the year, matching your tax payments to your actual cash flow. Plus, you get an extra 75 days after your terminal tax date to settle your affairs.
What if I’ve never had problems paying provisional tax?
Even businesses with perfect payment histories benefit from TMNZ:
- Better reminders: We proactively remind you of upcoming provisional tax dates – something the IRD doesn’t always do effectively
- Expert support: As New Zealand’s tax pooling originators with 20 years’ experience, we provide guidance the IRD can’t
- Insurance policy: If circumstances change, purchasing tax through TMNZ costs less than IRD penalties and interest
Any other benefits?
Using TMNZ for your provisional tax gives you:
- More time: An additional 75 days to pay after your terminal tax date
- Faster refunds: Surplus tax refunded within a week versus months with the IRD
- Cost savings: Purchase tax at rates lower than IRD penalties and interest
- Flexibility: Handle reassessments across all tax types using pooled funds
There’s virtually no downside to using TMNZ. Your funds sit in an IRD-linked trust account with crown risk protection. You only pay interest if you need to purchase tax – and our rates beat both bank lending and IRD penalty rates.
Start proactively, not reactively
While TMNZ can rescue you from a shortfall discovered late in the year, the smartest approach is proactive planning. By engaging with TMNZ at the start of your tax year, we can:
- review your provisional tax notice
- understand your business’s unique cashflow patterns
- design a payment arrangement that works with your seasonality
- ensure you meet all obligations without straining your working capital.
Getting started is simple
Ready to take control of your provisional tax? Getting started with TMNZ is straightforward:
- Using an accountant? They’ll already know TMNZ and can set everything up with minimal input from you
- Managing tax yourself? Contact us directly and we’ll review your situation and recommend the right solution
Your key takeaway
With 28 August approaching, now’s the perfect time to explore how TMNZ can benefit your business. Don’t wait for cashflow constraints to force your hand – be proactive and give your business the flexibility it deserves.
Ready to pay provisional tax on your terms? Contact our team of tax experts here.