It is important to know when provisional tax and terminal tax is due to IRD.
Your provisional tax dates will be based on two factors:
- your balance date (i.e. when your tax year ends) and;
- what accounting method you use to calculate your provisional tax obligations (i.e. standard, accounting income method, estimation or ratio option)
For example, the majority of New Zealand businesses have a March balance date and apply the standard method of calculating provisional tax. This means that their 3 provisional tax dates are:
- 28 August (first provisional tax date)
- 15 January (second provisional tax date)
- 7 May (third provisional tax date)
For your terminal tax date, this will depend on if you have extension of time. If you use a tax agent (as opposed to filing your own returns), you will have extension of time.
Using the same example above for March balance dates, the terminal tax date is either:
- 7 February (no extension of time) or
- 7 April (with extension of time)
To read the definition of provisional tax and other accounting terms, check out our Glossary page.