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
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.
Manage IR exposure with corporate tax pooling
With the 28 November provisional tax date fast approaching, now’s the perfect time to talk to larger clients about the benefits of TMNZ corporate tax pooling.
Tax pooling is an Inland Revenue-approved system to help New Zealand businesses manage their provisional tax. Instead of paying the IRD directly, taxpayers can purchase overpaid tax from other tax pool members and pay into the tax pool when it suits them.
As some businesses overpay tax when they have funds to spare, they help to cover other taxpayers that need a bit more time to meet their obligations. We like to think of it as businesses helping businesses.
TMNZ is proud to be New Zealand’s original tax pool, pioneering the concept in 2003. We haven’t looked back since, helping large businesses, SMEs, and sole traders with tax management.
With tax pooling, businesses that can’t meet their provisional tax liabilities can purchase tax from those that have overpaid. This is charged at a lower interest rate than the IRD’s use of money interest charges, and companies also avoid late payment penalties.
There are advantages on both sides of a tax pool. Companies that have overpaid into our pool can also earn more interest on their surplus tax than if they had paid the IRD directly.
Clients that experience volatility or pay substantial amounts of provisional tax (e.g., more than $100,000 at each date) can reduce their exposure to use of money interest by paying provisional tax into the Guardian Trust/TMNZ tax pool account at Inland Revenue (IRD) rather than directly into their IRD account.
In summary, here are all of the ways corporate tax pooling is great for large companies:
- Companies earn more interest on surplus tax than they would if they overpaid the IRD.
- Tax can be purchased if businesses have underpaid income tax.
- Tax can be swapped across provisional tax dates to reduce exposure to use of money interest.
- Overpaid tax can be refunded within three to five days — without filing a return.
- Businesses can access TMNZ’s in-house expertise for corporate tax pooling advice on how to optimise their provisional tax payments.
- Money is deposited in the TMNZ tax pooling account at IRD.
What’s more, by using the TMNZ tax pool, you and your clients are also helping to give back to New Zealand. All our profit is invested in the Whakatupu Aotearoa Foundation, supporting social and environmental causes.
Contact us today to find out how TMNZ tax pooling can help your clients.
How to find a great accountant: six qualities to look for
Thousands of independent business owners have an awful habit.
While steadily pedaling up the mountain of expansion, new hires, building a great brand, and newfound social media fame, these business owners attempt to juggle their tax payments and financial accounts with their little remaining time.
“We know our business best, so we’d may as well sort out the taxes ourselves…”
Maybe you are one of these owners.
Perhaps you’re putting off hiring an accountant due to the perceived expense.
Don’t delay! Your business can run more smoothly and efficiently than ever with an accountant’s help. An accountant with the right expertise will help you meet tax obligations and provide peace of mind at every stage of your business growth.
It’s time to leave the financial headaches to the professionals. We’ve compiled a list of reasons to convince you – as well as six qualities to identify in a great accountant – so you can keep the focus on nurturing and growing your business.
Should I hire an accountant?
The short answer is – YES.
A great accountant will help with:
- Forecasting
- Tax reporting
- Managing cashflow
- Paying provisional tax and assisting with Inland Revenue (IR) compliance
Unless you’re familiar with tax structures, hiring a chartered accountant is crucial to the success and longevity of your business, and is money well spent.
How do I choose the right accountant?
From start-ups to industry giants, all businesses benefit from hiring an accountant who can assist with managing risk and planning for growth. Provisional tax can be a contentious issue for small business owners.
Your accountant can ease the impact of provisional and terminal tax dates on your business by using tax pooling. Tax pooling gives you control over your provisional payments so that you aren’t stung with use of money interest and penalties if you miss or underpay IR.
Need to know how to find an accountant? Check out Premium TMNZ Accounting Partners.
We recommend you treat your search for an accountant as seriously as you would the recruitment of a new employee. You might seek word-of-mouth referral from peers, friends and family members. Ask them for feedback on your short-listed accountants, you may learn something your research wouldn’t have included.
Look for accounting firms with a similar size to your own company. As a rule, small to medium firms provide a more personalised service specialising in small business work and often have more competitive rates compared to larger accounting firms.
What questions should I ask an accountant?
In your search to find an accountant, look for these qualities:
- Are they registered as a chartered accountant in NZ? These professionals are experts in their field and adhere to the strictest NZICA Code of Ethics.
- How are their communication skills? Jargon is useless to you. Your accountant should be able to explain budgets and financial reporting in layman's terms for you and your team to easily understand.
- How much experience do they have with your business type or industry?
- What are their costs? Will they bill you hourly or monthly? Do they have a fixed fee?
- Do they have an entrepreneurial mindset, think outside the box and embrace innovation?
- Are they flexible and open to change? Your business will continue to grow and evolve. Your accountant needs to help you adapt to this change and manage it financially.
Once you find an accountant in New Zealand who you believe can help your business develop and grow, take the time to establish and nurture a solid, long-lasting business relationship.
Finding the best accountant for your business
Taxes, end-of-year-reports and ever-changing laws and legislation can get complicated. Don’t leave yourself open to penalties and interest. Find an accountant who understands your business and is willing to work with you to meet your goals.
The six qualities listed are a guide to help you find the best fit for your business. A good accountant may be an investment at first, but it is one you will be very grateful for in the long term. Take your time looking for someone who is qualified but also someone you get along well with as the relationship is just as important along the way to success.
Five essential accounting tips for small and medium businesses
Getting the right small business accounting advice is vital for the success and growth of your small business. Here are five essential tips to help organise accounting for your small business.
Keep a record of tax deadlines
Knowing when business taxes are due throughout the financial year is crucial for the health of your small business. If you miss an important deadline, you could receive a costly penalty.
In New Zealand, staying on top of GST returns and paying provisional tax on time is especially important.
Inland Revenue (IR) has resources available to remind you of these important dates. You can also check out our provisional tax calendar to see your terminal tax and provisional tax dates. It is important to be proactive about tracking these yearly deadlines to meet your ongoing tax obligations.
Make the most of automated accounting software
Automated accounting software can be a lifesaver for small businesses. Accounting software covers many of the fundamentals of running a small business. This software helps keep track of expenses and automatically generates forms and reports about your business. This lightens the load of your day-to-day accounting practices.
TMNZ is integrated with accounting software such as Tax Lab to make it that much easier and convenient to use tax pooling if a payment has been missed. To get the most out of accounting software, we would recommend a chartered accountant look over the specifics of your business for any gaps that may have inadvertently been overlooked.
Know your limits and hire a professional when necessary
Many small to medium business owners try to tackle bookkeeping on their own to save costs. But in the end, making errors or filing expenses incorrectly could prove costlier than hiring a professional.
Maintain a relationship with a chartered accountant who can help keep your books tidy. A reliable accountant can help you arrange tax pooling for your business. Tax pooling provides you with more control and flexibility to manage tax payments and can save your business money from late payment penalties and use of money interest.
You may only need your accountant’s services several times a year. However, having a professional on hand for accounting advice gives you precious peace of mind that your accounting is in order.
Don’t get caught out by unexpected costs
The longer your business is in operation, the more likely you are to face a large, unexpected cost. For example, you may find yourself needing to repair or upgrade your business’ equipment. This is costly, but unavoidable for your business to operate.
An unexpected cost could even come in the form of an opportunity to grow your business, such as a market gap that you could fill perfectly. Taking advantage of such opportunities requires up-front investment.
In either case, expect the unexpected and put money aside to cover unforeseen operational costs. Or consider using your tax payments as a line of credit with Tax Drawdown.
This is sound advice for any small business. Doing so will save you the headache of scrambling to cover a significant bill or missing out on the chance to grow your business.
TMNZ is trusted by thousands of Kiwi small and medium-sized businesses. We are the leading tax pooling provider in New Zealand and work closely with IR to ensure our services are secure and reliable.
Get in touch with our team today for tax pooling and provisional tax payment advice.
Prodigy Hair Industry cuts tax stress
Krystle Walker from Prodigy Hair Industry loves cutting and styling hair. She does not love provisional tax.
That’s why she uses TMNZ. They cut away the stress this causes her so she can focus on running and improving her salon.
But we'll get to that. First, some background.
The Prodigy Hair Industry story
Krystle is the owner and manager of Prodigy Hair Industry. It's in Upper Hutt, a city about 30 minutes outside of Wellington.
She has been plying her trade as a hairdresser for 12 years. Four of those have been at Prodigy Hair Industry.
It’s a stylish set-up she’s got on Fergusson Drive.
Things are humming nicely at Prodigy Hair Industry too. Seven staff on the books and a good customer base are a testament to that.
The challenges of being a business owner
Krystle is still wearing her training wheels in term of running her own business.
As she is discovering, transitioning from employee to employer is not without its challenges. There are wages to pay and hair products to purchase, among other things. Cashflow is a biggie.
Provisional tax is another challenge.
Krystle admits she is not a tax geek. In fact, in an ideal world it would probably be something she would not have to concern herself with.
But alas, this is not an ideal world. She knows there is no escaping the clutches of the taxman. Falling out with Inland Revenue (IR) has serious repercussions too.
Taking care of provisional tax so she can take care of business
Krystle avoids any such precarious situations with TMNZ.
Her tax pooling arrangement means her tax is taken care of. She makes payments when her business cashflow permits and TMNZ applies these to the correct tax dates.
No need to worry about late payment penalties. There is interest to pay. However, this is much lower than what IR charges when someone doesn't pay tax on time.
“It does reduce the stress month to month. Knowing that you have got my back, I don’t have to worry about that,” she says.
It allows Krystle to get on with doing what she does best – cutting and styling hair and making sure Prodigy Hair Industry is satisfying its customers’ needs.
“I can put 100 percent into the business and my staff.”
The concept of paying provisional tax through TMNZ was about as familiar as the Klingon dialect when her accountant first broached the idea.
But after hearing how it operates with the blessing of IR, Krystle says it was too good to pass up.
Now she has no qualms about recommending TMNZ to others occupying a similar waka to Prodigy Hair Industry.
“It’s great, especially for small business owners.
“It just gives me the confidence with my day-to-day cashflow.”
TMNZ is New Zealand’s first and largest tax pooling provider. Get in touch to learn more.