How does TMNZ help me manage provisional tax risk and volatility?
TMNZ lets you make your provisional tax payments directly into its tax pool account and this enables you to:
- Earn a higher interest than IRD pays (currently 1.02 percent) on overpaid tax by selling it to a taxpayer who has not paid enough.
- Get access to faster refunds – within three to five working days, and without filing a return.
- Swap payments between your provisional tax dates to smooth out payments.
- Use payments held in the tax pool as collateral to draw down short-term funds.
- Make one payment at each provisional tax date and redistribute the tax among group-related entities once the liability for the year is known.
Who should consider depositing provisional tax payments into the TMNZ tax pool?
Anyone can make their provisional tax payments into the TMNZ tax pool. However, those who have an annual income tax liability of more than $300,000 or experience huge fluctuations in their income from year-to-year will find it a valuable addition to their risk management strategy.
How does depositing into the TMNZ tax pool work?
Rather than paying tax directly to IRD on your provisional tax dates, you make these payments into TMNZ’s tax pool account at IRD. These payments are date stamped and recorded that they belong to you. Once the income tax liability for the year has been determined, we will work with TMNZ to see if we can improve your position if you have underpaid, overpaid or paid tax unevenly for the year. Upon your instruction, we will transfer your payments from the TMNZ tax pool to your IRD account. Your IRD statement will show these transfers at the original tax date once they have been processed, satisfying your income tax liability for the year.
Can I access any payments held in the TMNZ tax pool if required?
Absolutely. Any deposits made into the TMNZ tax pool can be refunded, transferred to your IRD account, sold or used as collateral to draw down short-term funds.
Will TMNZ notify me when I am due to make a deposit into the TMNZ tax pool?
Yes, we will send you reminders notifying you that your next instalment of provisional tax is due and the date by which you need to make payment. Payment instructions will also be included in these reminders.
Am I able to view my deposits held in the TMNZ tax pool?
Yes, your tax pool balances can be viewed by accessing your TMNZ account online.