Missed Your Tax Payment? 3 Ways TMNZ Helps Avoid IRD Penalties
If you’ve just realised you’ve missed your 15 January provisional tax payment, or you’re staring down a payment you simply can’t make right now, take a breath. You’re not alone, and there are options that can help you avoid penalties and get back on track.
At TMNZ, we work with thousands of New Zealand businesses every year who face the same challenge: provisional tax payments that don’t always line up with cashflow realities. The good news? TMNZ offers practical solutions that can save you money and give you breathing room.
What Happens if You Miss a Tax Payment?
Missing a provisional tax payment in New Zealand triggers a cascade of penalties and interest charges from IRD. Understanding what’s at stake can help you take action before costs spiral.
IRD Late Payment Penalties
IRD applies penalties in stages:
- 1% penalty – charged the day after the due date
- 4% penalty – charged 7 days after the due date (on top of the 1%)
- Use of Money Interest (UOMI) – currently 8.97% per annum (as at 16 January 2026), calculated daily from the day after the due date until paid in full
For example, if you owe $20,000 and miss the due date by two months, you could face approximately $1,000 in penalties alone—before UOMI is added.
First-Time Late Payers: Grace Period
If it’s your first late payment in a two-year period, IRD may offer you a grace period before charging penalties. They’ll notify you of this grace period and your new due date. However, if you don’t pay by the new due date, penalties are charged from the original due date. Don’t rely on this—it’s not guaranteed and only applies once every two years.
Understanding Your Options
How to Check Your Tax Position in myIR
Before you act, check where you stand:
- Log into myIR at ird.govt.nz
- Select your Income Tax account
- Select ‘View’ provisional tax to see your due dates and amounts owing
- Check your ‘Income summary’ for a breakdown of income sources
Your myIR account shows your provisional tax due dates, amounts paid, and any outstanding balances—giving you a clear picture of your obligations.
Comparing Your Options: IRD vs TMNZ vs Bank Finance
IRD Instalment Arrangement
- Set up through myIR to pay debt in weekly, fortnightly, or monthly instalments
- UOMI continues to accrue on the outstanding balance
- Some late payment penalties may be reduced if you set up before the due date
- Your payment is still recorded as ‘late’ with IRD
TMNZ
- IRD treats your tax as paid on time when transferred from the pool
- Eliminates late payment penalties entirely
- Interest rates significantly lower than IRD’s UOMI
- Flexible payment options—pay in instalments, defer, or access deposited funds
- You have 75 days from your terminal tax date to use tax pooling for the tax year
Bank Finance/Overdraft
- May require security or affect your credit facilities
- Interest rates often higher than tax pooling
- Uses up banking headroom you may need for business operations
- Doesn’t eliminate IRD penalties—you’re still paying late
The 75-Day Rule for Tax Pooling
A critical deadline to know: you have 75 days from your terminal tax date to use tax pooling to satisfy your provisional or terminal tax liabilities at backdated effective dates. For a standard 31 March balance date taxpayer with a tax agent, your terminal tax date is typically 7 April—giving you until late June to settle tax pooling for that tax year. Act early to ensure you don’t miss this window.
Let’s look at how three different businesses used TMNZ to navigate missed provisional tax payments.
Scenario 1: The project-based business
Meet the team at Bayside Builders*
Bayside Builders is a residential construction company with several homes due for completion after the January provisional tax date. They knew they’d have the cash to pay tax once the properties were signed off and final payments came through, but they couldn’t tie up working capital in tax when they needed it to finish the builds.
January hit, and the 15th came and went. Materials, subcontractors, and wages had to come first.
How TMNZ helped:
Bayside Builders used TMNZ’s tax financing option to defer their provisional tax payment. This meant they could:
- access financing at rates lower than their bank
- preserve banking headroom for construction costs
- avoid IRD penalties and use of money interest (UOMI)
- repay the tax finance once properties settled and revenue came in.
The result: Bayside Builders maintained the capital they needed to complete their projects, avoided penalties, and kept their banking relationships intact, all while meeting their tax obligations.
Scenario 2: The unexpected cashflow crunch
Meet the Andersons from Clearwater Station*
The Andersons run a sheep and beef farm in the South Island. By January, lamb sales are well underway, and cash is starting to come in. But this year, the farm was still recovering from a tough winter. The cost of carrying stock through the cold months—supplementary feed, animal health, and repairs—had stretched their reserves. When an unexpected dry spell hit and they needed to buy in more feed, the business account couldn’t stretch to cover both farm costs and the 15 January provisional tax payment.
But now they needed short-term access to those funds to keep the farm running.
How TMNZ helped:
Because the Andersons had deposited their tax into TMNZ’s pool, they were able to use the drawdown facility to:
- access their deposited funds for a short period
- bridge the immediate cashflow gap caused by the drought
- repay the funds once livestock sales came through
- avoid IRD penalties and maintain their tax position.
The result: The Andersons got through the drought without compromising their tax compliance or incurring penalties, and their funds were back in place once sales resumed.
Scenario 3: The seasonal business
Meet Jo from Coastal Homewares*
Jo runs a homeware and giftstore that does about 40% of its annual revenue in the lead-up to Christmas. By January, the shop is quiet, but the invoices from stocking up for the holiday rush—placed on 30 and 60-day terms—are all landing at once. Between paying suppliers, clearing staff holiday pay, and managing post-Christmas returns, cash is tight. Missing the 15 January provisional tax payment wasn’t the plan, but it was the reality.
How TMNZ helped:
Rather than facing IRD’s late payment penalties and UOMI, Jo purchased tax through TMNZ’s pool and set up a payment plan that matched her cashflow. This allowed her to:
- pay in flexible instalments spread over several months
- avoid late payment penalties entirely
- pay interest at rates lower than IRD’s UOMI debit rate
- get back on her feet without draining the business account
Because TMNZ had already made the payment to IRD on the original due date, IRD treated Jo’s tax as paid on time when it was transferred to her account.
The result: Jo kept her business running through the quiet months and avoided costly penalties, all while staying fully compliant.
Why This Matters
Missing a provisional tax payment doesn’t have to mean penalties, stress, or a hit to your reputation with IRD. TMNZ gives you options that work with your business reality, not against it.
Here’s what you need to know:
- Avoid penalties: When you purchase tax through TMNZ’s pool, IRD treats it as paid on time. That eliminates late payment penalties.
- Flexible payment options: Pay in instalments, defer to a future date, or access funds you’ve already deposited.
- Lower interest rates: TMNZ’s rates are lower than IRD’s UOMI debit rates and competitive with bank financing.
- Fast turnaround: We can often arrange solutions within days, not weeks.
Frequently Asked Questions
If you miss a provisional tax payment, IRD charges a 1% late payment penalty the day after the due date, followed by an additional 4% penalty seven days later. Use of money interest (UOMI) at 8.97% per annum also accrues daily until the debt is paid. These costs add up quickly, which is why taking action early is important.
Yes. Tax pooling allows you to purchase backdated tax credits that IRD treats as paid on the original due date. This eliminates late payment penalties entirely. TMNZ is an IRD-approved tax pooling intermediary that has helped thousands of New Zealand businesses avoid penalties since 2003.
You have 75 days from your terminal tax date to use tax pooling to cover missed provisional or terminal tax payments for that tax year. For most taxpayers with a 31 March balance date and a tax agent, the terminal tax date is 7 April—so you’d have until approximately late June. The sooner you act, the lower your interest costs.
Tax pooling is an IRD-approved system where provisional tax payments from multiple businesses are held in a pooled account. When one business overpays and another underpays, the overpayment can cover the shortfall. Because funds in the pool are date-stamped, purchasing tax from the pool means IRD treats your payment as made on the original due date—eliminating penalties and reducing interest costs.
Yes. TMNZ (Tax Management New Zealand) pioneered tax pooling in 2003 and is one of six registered tax pooling intermediaries approved by IRD. Tax pooling is fully compliant with New Zealand tax law and is used by thousands of businesses and accountants nationwide.
They’re separate charges. Late payment penalties are fixed percentages (1% immediately, then 4% after seven days) charged as a penalty for missing the due date. UOMI (use of money interest) is interest charged daily at 8.97% per annum on the outstanding tax balance until it’s paid. Both can apply simultaneously, making timely action crucial to minimising costs.
Ready to explore your options?
If you’ve missed your 15 January payment or you’re concerned about upcoming payments, our team can help you understand your options and put together a plan that works for your business. We’re here to make tax easier and help you stay in control of your cashflow, no matter what challenges come your way. Get in touch today.
*These scenarios are fictional examples created to demonstrate how tax payment solutions work to meet unique circumstances in a range of industries.
Tax Payment Trends for 2026: Supporting Business Growth Through Economic Recovery
Matt Edwards, Chief Executive Officer, TMNZ
As we move into 2026, New Zealand businesses are anticipating a turning point after navigating challenging economic conditions. Business confidence has surged to its highest level in nearly twelve years1, driven by aggressive central bank rate cuts and growing optimism about the recovery ahead. For business and tax advisors, this presents both opportunity and complexity.
At TMNZ, we’re seeing firsthand how evolving payment patterns are reshaping the way businesses manage their tax obligations, and we’re committed to supporting your clients’ growth throughout this pivotal year.
The Economic Landscape: Recovery with Caution
The New Zealand economy is projected to grow with real GDP expected to increase by 1.7% in 2025/26, rising to 3.4% in 2026/272, a welcome improvement after recent contraction. Business sentiment is notably strong, with manufacturers particularly optimistic about the year ahead.
However, the recovery is nuanced. While lower interest rates are providing relief to indebted businesses and the rural economy remains relatively robust, our urban centres continue to face headwinds. Unemployment is expected to peak around 5.5% in the March 2026 quarter, and inflation remains at the upper limit of the Reserve Bank’s target band. Core Crown tax revenue is forecast to rise as a share of GDP, from 27.3% in 2025/26 to 28.4% in 2029/303, largely driven by an improvement in the economy and the effect of wage growth moving people into higher tax bands. At TMNZ we have seen significant, double-digit year on year growth in tax deposits made by small and medium sized businesses, indicating that some businesses are expecting to be more profitable this year.
For advisors, this environment demands careful cashflow management. The gap between economic optimism and actual financial performance means that while businesses may be planning expansion, they’re also managing tighter margins and delayed investment decisions.
Emerging Tax Payment Trends
We’re observing several significant shifts in how advisors manage their clients’ tax obligations in 2026:
- Provisional tax calculation has become critical. In those industries that are struggling, many advisors are suggesting their clients to pay provisional tax based on actual cashflow rather than overpaying based on an uplift from the prior year liability.
- Tax pooling is gaining traction. More businesses are turning to tax pooling arrangements to manage provisional tax more efficiently, reducing the risk of underpayment penalties while avoiding the opportunity cost of overpayment. Tax advisors are increasingly encouraging their clients to pay their provisional tax through TMNZ. This trend reflects a more sophisticated approach to working capital management as businesses seek every advantage during the recovery phase.
- Tax payments are under scrutiny. With Inland Revenue’s increased focus on businesses with tax debt, advisors are setting up payment arrangements for provisional tax, while ensuring that clients’ GST and PAYE obligations are met by the due date.
How TMNZ’s Solutions Support Business Growth
At TMNZ, we recognise that effective tax payment management isn’t just about compliance – it’s about enabling growth for your clients. Our payment solutions are designed for the challenges businesses face in 2026:
- Flexible payment scheduling allows you to align your client’s tax payments with their actual cashflow patterns, particularly valuable when revenue remains uncertain. Rather than forcing provisional tax payments to fit rigid schedules, our payment solutions match to business rhythm.
- Integrated payment tracking provides real-time visibility across provisional tax obligations. For advisors managing multiple entities or complex group structures, this consolidated view eliminates the risk of missed deadlines and provides the data needed for strategic cashflow planning.
- Payment reliability matters more than ever. As your clients invest in growth initiatives, the last thing they need is a missed payment disrupting tax compliance or damaging their relationship with Inland Revenue.
Looking Ahead
The economic outlook for 2026 represents a genuine opportunity for New Zealand businesses. Capital investment is forecast to increase 6.1% in calendar 20264, its strongest pace of expansion since 2021. This is the environment where strategic tax payment management transforms from a compliance function into a growth enabler.
For advisors, the message is clear: businesses that can efficiently manage their tax obligations while preserving working capital for investment will be best positioned to capitalise on the recovery. At TMNZ, we’re committed to providing the payment tools that makes this possible.
As we navigate 2026 together, I encourage you to review your current tax payment processes. Are they supporting your clients’ growth objectives, or are they simply maintaining compliance? The difference matters, and TMNZ is here to help you bridge that gap.
1 New Zealand Institute of Economic Research (NZIER) Survey of Business Opinion, January 2026
2 New Zealand Treasury Half Year Economic and Fiscal Update 2025
3 New Zealand Treasury Half Year Economic and Fiscal Update 2025
4 BNZ Economic Forecast for 2026
Commissioner’s discretion for tax pooling
For many years, tax pooling legislation assumed that taxpayers would always file tax returns, and any errors or omitted tax would be dealt with for pooling under the “increased amount of tax”. In time Inland Revenue realised that many taxpayers, such as salary and wage earners, don’t have to file tax returns. But if they later identified that they had another type of taxable income (such as foreign trust income), they couldn’t use tax pooling to settle the liability as they hadn’t filed an original return.
Inland Revenue created the right for taxpayers to apply for Commissioner’s discretion to use tax pooling where a return for RWT or Income tax hadn’t been filed, and the taxpayer filed a voluntary disclosure which included the underpaid tax. But from 2009 until 2022, the discretion only covered these two tax types – RWT and income tax.
In 2022, Inland Revenue accepted that the discretion should be extended to other tax types. It is not uncommon to find taxpayers who had not been aware of a liability (often a withholding tax or FBT) and so had never filed returns for those taxes. Without the ability to use tax pooling, some chose not to report the errors to Inland Revenue, or to report them going forward, rather than rectifying the past. So Inland Revenue amended section RP 17B to allow the Commissioner’s discretion to be used for other tax types including ones we often get asked about such as GST, FBT, and RWT and NRWT. In 2025, AIL was added to the list of tax types.
The full list of tax types that can be used for Commissioner’s discretion is:
- ESCT
- FBT
- Further income tax
- GST
- Imputation penalty tax
- Income tax
- NRWT
- PAYE
- RSCT
- RWT
- AIL
It’s good to note the PIE tax is treated as income tax, and can be transferred to IRD as INC.
There are some criteria that determine whether a taxpayer can get Commissioner’s discretion. The most important of these is that Inland Revenue has to be satisfied that the taxpayer was not deliberately failing to comply with their tax obligations.
These are the rules for using tax pooling for a voluntary disclosure where no return has been filed:
- The voluntary disclosure must be filed within a reasonable time frame of identifying the error. What is a reasonable time frame? Inland Revenue considers it will be about 3 months.
- The taxpayer must notify Inland Revenue before they receive any notice of an audit by Inland Revenue.
- The Commissioner must be satisfied that the new liability was not caused because the taxpayer didn’t take reasonable care with their tax obligations.
Inland Revenue has set out their criteria for granting discretion in TIB Volume 34, Number 5 at page 33. Here is a summary of their discussion.
The relevant parts of the TIB state the following
The requirements to be met to be able to use tax pooling are:
- The person must make a voluntary disclosure of a “new liability”, not being a liability that arose from a return by the person, or an assessment of the person, made before Inland Revenue has made any contact with the person or their agent.
- The person must notify the Commissioner, which results in an assessment of, or obligation to pay, the new liability.
- The voluntary disclosure must be made within a reasonable time after the earliest time the person or their agent became aware of the new liability, and before the date of notification of the Commissioner or the person is notified of a pending tax audit or investigation or that a tax audit or investigation has started.
- The Commissioner must be satisfied that the new liability did not arise as a result of a choice by the person not to comply with the person’s obligations under the Inland Revenue Acts or as a result of a failure by the person to take reasonable care to comply with those obligations.
There are two aspects of these requirements that could create some uncertainty:
- the voluntary disclosure must be made “within a reasonable time” after the earliest time that the person or the person’s agent is aware of the person’s new liability, and
- the new liability must not arise as a result of a choice by the person not to comply with the person’s obligations under the Inland Revenue Acts or as a result of a failure by the person to take “reasonable care” to comply with those obligations.
Both these tests will be fact dependent, but some guidance is provided below.
Within a Reasonable Time
Generally, “within a reasonable time” will be within a period of less than three months. However, the circumstances of the specific taxpayer will also be considered. Inland Revenue considers the phrase means that provided the taxpayer applies at the earliest opportunity after they or their agent becomes aware of the liability, then the test will be met. There are limited situations where a request for relief outside this time frame may still have been made “within a reasonable time”. Ultimately it will depend on the circumstances of the particular case. However, the circumstances of the taxpayer would need to be such that they could not have reasonably advised Inland Revenue within three months. For example, sickness or injury that extended beyond the three-month period and made them unable to make a voluntary disclosure may still satisfy “within a reasonable time”.
This is yet to be determined and guidance around this will be issued but early indications are 4 weeks would be reasonable and 4 months is likely not to be. Discussions we’ve had with the Revenue indicate that you can file the voluntary disclosure without having quantified the error if you need more time to do so as it is the notification of the error within a reasonable time frame that is important. This will be useful where you may have identified a system error that means a return hasn’t been filed but you’re not yet sure how long the error has been occurring and therefore what the value of the error will be.
The new liability also cannot be as a result of a choice not to comply e.g., you deliberately chose not to file the return or from a lack of reasonable care to comply with your obligations.
If you’d like to know more, please contact our team of tax pooling specialists.
How to manage business cashflow over the seasonal period
Summer’s here. A time for family, friends, and well-earned downtime. But for many small and medium-sized Kiwi businesses, it’s also one of the toughest periods for cashflow. The challenge is heightened for many sectors that experience a slow period in January and February, while provisional tax and GST payments are due on 15 January for businesses with a 31 March balance date.
This year brings additional pressure with the 2025/2026 Christmas and New Year public holidays falling midweek on Wednesdays and Thursdays. This creates a fragmented two-week period where many businesses will close or operate at reduced capacity.
Let’s look at why Christmas creates cashflow challenges and what options can help you navigate this seasonal period more smoothly.
Why Christmas creates cashflow challenges for NZ businesses
The period after Christmas is traditionally slow. For sectors like hospitality or retail, there’s a surge in demand before Christmas that makes the January drop-off particularly harsh.
Additional pressures businesses can come under include:
- business closures or reduced capacity over the break – less income generated
- employee incentive schemes and bonuses paid before Christmas – draining cash reserves right before the quiet period
- reduced consumer spending in January and February – as consumers apply more caution after the holiday spending surge
- inventory tied up in stock – particularly challenging for retail businesses with cash locked in unsold summer ranges
- slower bank processing times – public holidays and weekends can delay payments arriving in your account
Together, these create what many business owners know as the “summer squeeze” on cashflow, with added pressure to cash reserves with the 15 January provisional tax deadline.
The 15 January provisional tax deadline
With these seasonal challenges, it’s no surprise many businesses struggle to manage cashflow and meet the 15 January provisional tax deadline.
Unfortunately, Inland Revenue doesn’t factor in these seasonal challenges. They’ll charge 3.27% late payment penalties and 9.89% use of money interest (UOMI) if tax isn’t received on the due date (rates as at May 2025).
Many businesses find this timing particularly challenging given the seasonal slowdown and reduced cash reserves after the holiday period.
Ways to manage your Christmas cashflow
So what are your best options?
Many businesses take a proactive approach to their Christmas cashflow. Here are a few key areas to consider:
Accounts receivable – review outstanding invoices before the holiday period and follow up with customers to improve collection timing. Early December works well to encourage payment before businesses close for the break.
Supplier relationships – if you have good trading relationships and have been a reliable payer, consider discussing your payment schedules with suppliers over the seasonal period.
Planning ahead – create a cashflow forecast covering the December to February period. This helps identify potential gaps in advance, including reduced trading days, holiday bonuses, and the 15 January tax payment.
Every business situation is different. It’s worth discussing your specific circumstances with your accountant or financial adviser.
A smarter way to manage tax payments
Looking at your provisional tax payment timing? TMNZ offers a smarter alternative.
Tax pooling through TMNZ is approved by Inland Revenue and trusted by New Zealand businesses. It lets you defer provisional tax payments to a time that suits you, without incurring late payment penalties and UOMI.
It’s more affordable than many traditional forms of finance, doesn’t affect your existing credit facilities, and requires no credit checks or security.
You only pay back what you actually owe. If your tax liability is less than expected, you don’t need to repay the full amount. And the finance arrangement can be easily extended.
How it works
Say you need to defer a $5,000 provisional tax payment for 6 months. You’d pay TMNZ a one-off, tax-deductible interest amount, and we’d arrange the $5,000 provisional tax payment on your behalf.
The interest amount is based on the tax amount financed and the deferral period. In this instance, it would be roughly $130.
The provisional tax payment is held in an IRD account administered by Guardian Trust. They instruct IRD to transfer the tax into your IRD account when you repay the $5,000 principal in 6 months.
IRD treats the $5,000 provisional tax as paid on time once the transfer is processed. It’s that simple.
Key benefits of tax pooling:
- IRD-approved
- doesn’t impact your existing credit facilities
- no security or credit checks required
- flexibility to adjust if you owe less tax than expected
Planning ahead for the summer period
The businesses that navigate Christmas cashflow most successfully? They start planning early. Consider reviewing your cashflow position in October or November, before the holiday rush begins. This gives you time to understand your position and explore options that work for you.
Your accountant can help you assess your specific situation and what approaches might work for you, including whether tax pooling could be the right solution for managing your 15 January provisional tax obligations.
Take control of your summer cashflow
Christmas doesn’t have to be stressful for your cashflow. With forward planning and the right solutions, you can navigate the seasonal challenges while keeping your business on track.
Ready to ease your seasonal cashflow pressures? Learn more.
Need to calculate your provisional tax? Check out our Calculating Provisional tax guide.
Three ways TMNZ’s tax finance solution has supported NZ business success
Cashflow challenges don’t wait for convenient timing – and neither do business opportunities.
Since 2003, TMNZ has helped over 25,000 Kiwi businesses improve cashflow through our provisional tax solutions, including tax finance – a better way to delay income tax payments.
Three different businesses. Three different challenges. Three smart ways tax finance made the difference.
Who tax finance can help
Tax finance through TMNZ can help if you’re:
- facing a cashflow squeeze during seasonal low periods
- spotting time-sensitive opportunities that need immediate capital
- growing your business and need working capital for expansion
- managing the timing mismatch between seasonal revenue and tax obligations
Smarter savings in the hospitality industry
The situation
A local hospitality equipment supplier spotted an opportunity too good to miss. As an importer of specialised restaurant equipment, they noticed currency exchange rates had shifted significantly – making their European supplier’s products much more affordable than usual.
The challenge
The timing was perfect for acquiring high-quality equipment at reduced prices. But there was a catch. Their provisional tax payment was due soon, and the funds set aside for it were exactly what they needed to secure the deal. It’s a dilemma many business owners know well – choose between meeting tax obligations or capitalising on growth opportunities.
The solution
Rather than missing out, they found a practical solution through TMNZ. The approach was straightforward. Partner with TMNZ to defer their provisional tax payment for interest rates similar to your mortgage. Use those funds to purchase the discounted equipment. Maintain compliance with Inland Revenue while pursuing growth.
The results
The results? Success on multiple fronts:
- acquired high-quality equipment at below-market prices
- maintained healthy cashflow despite the significant purchase
- increased profit margins on future equipment sales
- kept tax obligations in order without penalties
- enhanced their competitive position in the market
The takeaway
Tax payments don’t have to be inflexible deadlines. This shows how working with TMNZ helps you manage tax obligations while seizing time-sensitive opportunities that enhance profitability.
And here’s the important bit – all TMNZ tax finance arrangements are 100% Inland Revenue approved. You can defer payments with complete compliance and peace of mind.
Scaling up in the transport industry
The situation
A transport business landed a fantastic opportunity – a contract supporting a major infrastructure project that could take their company to the next level.
The challenge
The timing created a cashflow squeeze. Winning the infrastructure contract was a milestone achievement, but they needed to expand their trucking fleet immediately to meet requirements. Like many growing businesses, they had funds set aside for provisional tax but needed that same cash to fund expansion.
The solution
The business owner took a smart approach. Partner with TMNZ to defer their tax payment for 12 months. Use their provisional tax funds to purchase an additional truck. Start servicing the new contract immediately with an expanded fleet.
The results
The results delivered multiple benefits:
- secured and started the valuable infrastructure contract
- increased fleet capacity and revenue potential
- generated immediate positive cashflow from the new truck
- maintained good standing with Inland Revenue
- spread tax payment over a more manageable timeframe
The takeaway
Small business growth often requires making quick decisions when opportunities arise. This shows how flexible tax payment arrangements help you invest in growth while managing tax obligations responsibly.
Supporting cashflow over summer in the electronics industry
The situation
A small electronics distribution company faced a common seasonal challenge. Like many in their industry, they closed during the Christmas period through mid-January, aligning with their major clients’ shutdown periods.
The challenge
The holiday season created multiple financial pressures. Zero revenue during the extended Christmas closure. Staff holiday pay obligations coming due. Income tax and GST payments due on 15 January. The business owner worried they wouldn’t fully enjoy their family holiday because of financial stress.
The solution
The business owner took proactive steps to manage seasonal cashflow and connected with TMNZ in December. They recognised the recurring nature of the holiday squeeze and decided to arrange deferring their 15 January income tax payment until April from now on. This maintained GST compliance while managing cashflow more smartly.
The results
The results? Both financial and personal benefits:
- balanced holiday season expenses without depleting cash reserves
- maintained staff satisfaction with timely holiday pay
- shifted tax payments to align with stronger cashflow periods
- enjoyed stress-free family time at the beach
- started the new year in a stronger financial position
The takeaway
Many seasonal businesses face predictable cashflow challenges during holidays. This shows how planning ahead and using flexible tax payment arrangements helps you manage obligations while protecting crucial family time.
Payment flexibility that works for your business
Up to 75 days of payment flexibility after your terminal tax date. Breathing room to manage cashflow on your terms while maintaining full Inland Revenue compliance.
Ready to explore how tax finance could work for you? Managing seasonal cashflow challenges? Funding growth opportunities? Or simply want more flexibility with provisional tax payments? Learn more about our tax finance solutions here.
How Findex NZ uses TMNZ to solve provisional tax challenges
The Situation: Delivering Proactive Tax Advisory
Jarod Chisholm is the Managing Partner of Tax Advisory at Findex New Zealand, one of the country’s leading accounting, tax advisory, and financial advisory firms. With 24 offices across New Zealand, Findex serves a diverse range of clients from listed companies to mum and dad investors, with a sweet spot in the entrepreneurial, high net worth, and mid-market space. Many of these clients are looking to grow, and they need smart solutions to manage their tax obligations without sacrificing that growth.
The Challenge: The Provisional Tax Pressure
When clients come to Findex to discuss their tax obligations, they often arrive with real concerns:
- Cashflow pressure: Many businesses don’t have the funds available on provisional tax due dates like , or they’d prefer to use that working capital to maximise and grow their business rather than tie it up with Inland Revenue.
- Uncertainty: Some clients aren’t sure what their actual tax liability will be because they’re waiting on settlements, sales projections, project completion or other big transactions to occur.
- Timing mismatches: Businesses may have transactions occurring at a later date but need to meet their tax obligations now.
- Growth constraints: When funds are paid to IRD early, that capital is locked away when it could be invested in business growth opportunities.
As Jarod puts it: “When managing tax, our clients have a lot of issues they face. Some face cashflow issues where they can’t afford to pay on the due date like 15 January . Some clients like to use the funds to maximise and grow their business, and that’s when TMNZ comes in.”
The Solution: A Smarter Way to Pay Provisional Tax
Findex has partnered with TMNZ since the early days of tax pooling in New Zealand. Here’s how TMNZ helps Findex deliver better outcomes for their clients:
- Payment flexibility: Clients can defer tax to a later date or pay it off in instalments when cashflow is tight, without risking IR penalties and interest.
- Cashflow management: Even clients who have the money to pay benefit from using TMNZ, because it gives them the option to draw funds back down, to support business growth.
- Rapid access to capital: When COVID hit, Findex clients had tax funds in TMNZ’s pool and were able to access that capital within three days to manage business uncertainty.
- Cost savings: Clients pay less than they would in IRD penalties and interest, with competitive rates that beat bank financing options.
- Proactive alerts: When a client misses a payment, Jarod receives an email immediately, allowing the team to be proactive in offering their clients smart payment options through TMNZ.
The Results: Reduced Risk & Client Growth
More than a decade into the partnership with TMNZ, Findex has been able to deliver tangible value in the following ways:
- Better client conversations: TMNZ gives Findex’s team a toolkit to have more meaningful, strategic discussions, not just compliance tick-boxes.
- Enabling business growth: Clients can reallocate funds to invest in opportunities as they arise, rather than having capital tied up with IRD.
- Stronger client relationships: The ability to solve cashflow problems and offer flexibility has helped Findex retain clients and stay ahead of competitors who don’t offer these solutions.
- Reduced stress: Clients sleep better knowing their tax obligations are covered and they have options if circumstances change or when they’re in slow sales period like over the holiday season, when tax is still due.
- Simplifying compliance: Integrations with accounting systems and proactive reporting makes it easier for the Findex team to manage client tax payments efficiently.
And there’s another layer. Findex clients know that when they work with TMNZ, they’re also giving back. TMNZ invests 100% of its profits into Whakatupu Aotearoa Foundation, supporting communities and the environment across New Zealand. For Jared, that shared commitment to purpose is another key reason for the long-term partnership.
Key Takeaway: Delivering Value Beyond Compliance
Tax doesn’t have to tie up capital or limit growth. Even when navigating reduced income, slower sales cycles or other seasonal challenges. By partnering with TMNZ, Findex has given their clients the flexibility to manage cashflow strategically paying tax on their terms, accessing funds when needed, and focusing on what matters most: building their businesses. For accountants, offering these solutions isn’t optional—it’s about delivering genuine value and staying relevant.
For more on how TMNZ’s solutions can help your business or clients, go here.
How Mitre 10 MEGA Dunedin unlocked provisional tax flexibility with smart solutions
The Situation: Rapid Growth & Retail Complexity
Duncan Rae is the Financial Controller at Mitre 10 MEGA Dunedin, overseeing the financial operations for this major retail operation, plus stores in Mosgiel and Wanaka. With around 250 staff at the Dunedin store alone, Mitre 10 MEGA Dunedin is a significant employer and a vital part of the local community. Duncan has been with the business for nearly 30 years, navigating the complexities of rapid growth and seasonal cashflow pressures.
The Challenge: Seasonal Cashflow vs Tax Obligations
Managing tax for a rapidly growing retail business came with several challenges for Duncan and his team:
- Rapid growth: As sales expanded quickly, tax obligations grew proportionally, creating pressure on working capital.
- Lumpy income streams: With extensive development projects alongside retail operations, income could be irregular. Settlements might be years apart, making it tricky to pay the right amount of provisional tax.
- Cash is king: In retail and property development, cashflow management is everything. Balancing tax payments with operational needs and growth investments required careful planning.
- Complexity: With multiple business arms and various payment methods, managing tax compliance across the group was becoming increasingly complex.
The Solution: Flexible Provisional Tax Payments
Duncan discovered TMNZ at an accountants’ conference in Queenstown several years ago. While initially cautious about paying tax to an organisation other than IRD, Duncan did his due diligence, speaking with other large companies who assured him TMNZ was legitimate and trustworthy.
The Results: Taking Control of Tax Dates
TMNZ provided Mitre 10 Dunedin with:
- Payment flexibility: The ability to pay tax when it best suited their business cashflow, not just on IRD’s timeline.
- Expert guidance: Access to tax specialists who understand the complexities of the industry.
- Easy refunds: When they occasionally overpaid tax, getting money back was incredibly simple, just a quick call and funds were back in their account within days.
- Peace of mind: Proactive reminders about tax deadlines and payment options, taking the stress out of tax compliance.
- Personal support: A dedicated team that knows their business and can be reached quickly by phone, email, or chat.
Key Takeaway: Managing Complex Cashflow
For business with complex cashflow patterns, or those experiencing rapid growth, or managing multiple income streams, tax flexibility isn’t just nice to have, it’s essential. By partnering with TMNZ, Mitre 10 MEGA Dunedin has gained the cashflow flexibility and expert support needed to navigate complex tax obligations with confidence, allowing them to focus on what they do best: serving their community and building for the future.
For more on how TMNZ’s solutions can help your business, go here.
Tax payment flexibility. Too good to be true?
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 15 January 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.
CA ANZ and TMNZ join forces to drive innovation in tax services
Tax Management New Zealand (TMNZ) and Chartered Accountants Australia and New Zealand (CA ANZ) have announced a new partnership aimed at driving innovation in tax services through tax pooling, education, market insights and events.
The three-year alliance between TMNZ (New Zealand’s largest tax pooling provider) and CA ANZ, (Australasia’s peak professional organisation for accountants), will deliver substantial benefits to CA ANZ’s 31,000 New Zealand members, through streamlined access to TMNZ’s fintech products aimed at driving compliance efficiencies and boosting business cashflow.
TMNZ has served thousands of accountants and taxpayers nationwide since 2003, including major banks and leading corporates. The partnership will support CA ANZ members with professional development, thought leadership, digital enablement, early-career support and community impact.
This includes continuing professional development (CPD) focused on managing Inland Revenue audits, thought leadership and insights including the annual Inland Revenue Satisfaction Survey, events such as the annual CA ANZ Tax Conference, tax pooling guides, the latest tax tech solutions, and more.
New Zealand businesses partnering with CA ANZ members will have access to tax management solutions and tools for cashflow optimisation. This collaboration aims to support productivity improvements in the economy and promote digital transformation within the tax sector.
Backed by Business Leaders
“By working together, we’re able to offer more than 31,000 chartered accountants streamlined access to innovative tax management solutions, professional development opportunities, and the latest fintech tools,” said CA ANZ NZ Country Head Peter Vial FCA.
“Partnering with CA ANZ amplifies our vision of transforming tax compliance into a strategic business advantage,” said Matt Edwards, Chief Executive Officer of TMNZ.
“Together, we’re creating a future where accountants are empowered with cutting-edge tools, technology, communities and expertise to deliver exceptional client outcomes. We’re building something that will define the future of accounting services in New Zealand.”
Innovating to transform New Zealand
As a purpose-driven business, TMNZ directs 100% of their profits to philanthropic partner, Whakatupu Aotearoa Foundation, for initiatives that help New Zealand’s communities and the environment to thrive. The strategic alliance means CA ANZ members will effectively be contributing towards efforts to build a better New Zealand, including investment in ocean research, youth development, entrepreneurship and climate initiatives.
The partnership takes effect immediately, with TMNZ working closely with CA ANZ to roll out member benefits, educational programmes and events including the CA ANZ National Tax Conference in November 2025, with TMNZ being the exclusive tax pooling partner.
Find out more about the partnership here www.tmnz.co.nz/caanz
Why the Worst Time Feels Like the Best Time to Invest
By Matt Edwards
Spring is here, and with it comes the usual talk of growth — of grass, of the economy, and hopefully, of Kiwi businesses.
But beneath the chatter lies a sobering truth: New Zealand’s productivity problem is as stubborn as ever. For decades, our output per hour worked has lagged behind nearly every other developed economy, leaving us close to last in the OECD rankings. If we want to maintain our standard of living and the social services we value, we can’t afford to carry on like this.
We’ve been here before. Decade after decade, we’ve prided ourselves on hard work while watching other countries outpace us in output per hour. That’s not a reflection of our people — it’s a reflection of how we invest (or don’t) in the assets, technology, and skills that drive long-term productivity.
The problem is becoming more acute now. Over the coming decades, New Zealand faces growing unfunded liabilities as our population ages, people retire, and healthcare and superannuation costs rise. The obvious lever to address this is taxation, and ideas like the introduction of a capital gains tax to raise more revenue continue to be debated.
The degree to which increased taxation has a negative impact on a country’s overall productivity is a hotly contested question. There are certainly strong arguments that taxes on capital gains can disincentivise investment and entrepreneurship — two things critical to lifting productivity. These are concerns that smart tax policy can overcome. What most people can agree on is that higher productivity will drive economic growth, which in turn drives higher tax receipts.
Higher productivity will lift the standard of living in New Zealand and help fund social obligations into the future. The crux of the problem is: how do we do it?
The Bottom of the Cycle Is the Best Time to Invest
It may sound counterintuitive when many businesses are feeling the squeeze, but the bottom of the economic cycle is the right time for businesses to invest in the future. Adversity and tough conditions create the perfect environment for thinking about how to drive efficiency, deliver more value, and create a more productive operation.
Businesses that are forward-thinking and playing a long game will emerge from the current downturn leaner, faster, and better prepared to capitalise on the inevitable economic upswing.
This isn’t blue-sky thinking. We can look to one of New Zealand’s most successful and important industries — dairy — as an illustration. Investment in technology as well as improvements in breeding, pasture management, and herd practices have driven continuous increases in yield and farm productivity over many decades.
A forward-thinking dairy operation does not stop investing because milk solid prices are low. They continue to make sustainable investments with a long-term view that when prices rise, they will reap the reward — as we are currently seeing in the dairy industry.
Waiting for ’certainty’ before investing is a trap. By the time certainty arrives, opportunities are gone and the market has already moved. The real winners are the ones who keep moving forward when everyone else freezes. There is arguably more opportunity in a tough market for businesses that have a long-term view.
Investment Boost: Good, but Not Enough
The Government is acutely aware of New Zealand’s productivity issue and the challenges it creates. The Investment Boost scheme, designed to lift productivity by encouraging investment in new technology, machinery, and equipment, is a clear indicator of this.
The scheme, which allows quicker depreciation of capital investments, is essentially a cashflow tool — lowering tax obligations and increasing cash available for investment. It’s a great idea, but the immediate impact requires a business to be operating profitably. If a business is in losses or at an early stage, the benefit is not immediate.
Policy nudges are good, but to really yield a productivity lift there needs to be a direct, multi-decade, and non-partisan push for higher productivity that touches many more areas than just tax policy.
Finland is a good example of this, where productivity gains have become central to Government policy and, arguably, part of the national culture. The Finnish Government’s productivity strategy combines high R&D spending, skills development, digital adoption, labour force participation policies, and the ‘green transition’. Their approach is not just about cutting costs but about raising value-added per worker and per firm through innovation, education, and sustainable competitiveness.
The Long Game Matters
Investing in plant, machinery, technology, or staff training isn’t about quick wins. It’s about building the foundation for sustained, consistent growth over 10 years or more. It’s about breaking free from New Zealand’s addiction to short-termism — an addiction that keeps us underperforming while our competitors surge ahead.
Yes, it’s uncomfortable to spend when your P&L is bleeding. But the alternative is worse: stagnation, the slow road to decline.
Access to affordable working capital is often said to be the main barrier to small and medium businesses investing to increase capacity or productivity.
Tax Pooling as a Productivity Driver
A tool that is still grossly underutilised by New Zealand businesses is tax pooling. Although it doesn’t have a catchy name like Investment Boost, tax pooling is a fantastic example of innovative tax policy that can drive long-term benefits for business and productivity.
The policy allows businesses to defer or smooth out provisional tax payments for up to 22 months without incurring penalties or interest. It supports tax compliance but also frees up working capital.
That capital can instead be directed into new equipment, technology, or staff training — exactly the kind of investments that can lead to productivity uplift.
Additionally, unlike bank loans, tax pooling requires no security, doesn’t affect bank covenants, and avoids lengthy approval processes. It’s effectively hidden-in-plain-sight access to capital, and the cost is often materially cheaper than other funding sources.
The Ball Is in Our Court
Ultimately, Government policy alone will not solve New Zealand’s productivity challenge. It is an important catalyst, but business leaders need to adopt a long-term view, and mediocrity needs to be consigned to the history books.
The decisions we make now as business leaders — in what feels like the worst of times — will decide which businesses thrive when the cycle turns.
So, ask yourself: are you positioning your business to be ready for the upswing, or are you waiting on the sidelines while others quietly invest and get ahead?
Because here’s the reality: if we don’t change how we invest, we don’t change our productivity. And if we don’t change our productivity, we don’t secure our future.
Matt Edwards is CEO of TMNZ and has grown successful FinTech business in the UK.