Tax refund / owed

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Forums › Finance and wealth management › Tax refund / owed

leo0787sx

407 posts

Ultimate Geek
+1 received by user: 25

#191076 22-Jan-2016 13:38

Hey guys,

For the past 5 years I've used a tax agency to process my tax refunds. I recently decided to look at doing it myself and checked out the IRD website.

Now for 3 of the years a PTS has been processed and I got a refund, however the other 2 years I was told by the tax agency there was no refund, looking at it now it looks like I might owe some tax, it could be I am calculating it wrong but no PTS has been processed for these two years.

Wouldn't the tax agency of told me this? Or wouldn't IRD contact me if I did owe tax?

Thanks.

mattwnz

20515 posts

Uber Geek
+1 received by user: 4795

#1476824 22-Jan-2016 13:47

You are best to ask the accountant you are using who is currently doing it for you, as that is what you pay them for.

Dratsab

3964 posts

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Lifetime subscriber

#1476827 22-Jan-2016 13:52

Depends on the amount. If it's quite small it might not be worth the IRD chasing it up. The agencies T's & C's should tell you all you need to know about their notification process. As far as I know the rule of thumb is:
- if you are owed money they'll tell you, arrange a refund and take their fee
- if you owe money they'll tell you there's no refund due

The second point is a 'technically correct' scenario and the agency will leave things where they lie. It's the IRD's responsibility to collect money from you if they deem it worthwhile. If they haven't contacted you, don't waste any time worrying about it.

slingynz

154 posts

Master Geek
+1 received by user: 53

#1476832 22-Jan-2016 13:58

No PTS means IRD don't know you owe them :) Once you request a PTS for those years, IRD will ask for payment.

http://www.ird.govt.nz/income-tax-individual/refund-bill/entitlement/iit-tax-refunds.html

If you don't check whether you will get a refund before you request a PTS you may end up with a tax bill that you will have to pay.

SATTV

1670 posts

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ID Verified

#1476833 22-Jan-2016 14:00

leo0787sx:

Wouldn't the tax agency of told me this? Or wouldn't IRD contact me if I did owe tax?

My sister in law had this happen to her, she did not hear from the company ( one of the ones on TV ) as they got no comission.

The first she new about it was a demand letter from IRD + a bucket load of interest.

The IRD had sent a letter to the accounts company and they ignored it. ( when you join up you sign something to say that they are your accountant and all communications go through them )

If I recall there was something in the Herald about this a couple of years ago,

I would recommend you get a decent accountant and then pay any tax owed.

Cheers

John

I know enough to be dangerous

wasabi2k

2102 posts

Uber Geek
+1 received by user: 860

#1476853 22-Jan-2016 14:25

And for others - don't bother with those tax refund places that advertise on TV. You can do everything they do on the IRD website and you don't have to pay them a commission.

If you have a complicated tax situation then use a real accountant.

edit: The IRD have also been super helpful whenever I contact them with questions.

leo0787sx

407 posts

Ultimate Geek
+1 received by user: 25

#1476874 22-Jan-2016 14:59

I checked my IRD online and it shows no payments due so guess I don't owe anything. I am stopping using the Tax agent and going to process all my own using the IRD website.

Also in terms of filling a PTS it says:

you have tax to pay: stop - do nothing. This amount does not need to be assessed for payment.

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Brumfondl

1198 posts

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#1476879 22-Jan-2016 15:07

There is a simple way to look at it for a normal PAYE payer. A PTS makes things official. Until one is generated IRD don't owe you and you don't owe them. If you do the calculations and they come out in your favour then request a PTS. If the come out in the IRD's favour then don't request one and all will be well and within the law.

I think the idea is that the people not saying they owe money is more than balanced by the people not realising they are owed money so the IRD doesn't really lose out.

bazzer

3438 posts

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#1476886 22-Jan-2016 15:32

As long as you don't need to request a PTS then if you owe them there's no need to do anything. You don't request it, you don't owe them anything. However, if you did have to request one (or IR3) and you don't and they find out it would be a bad thing.

Kyanar

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#1477157 23-Jan-2016 00:41

leo0787sx:

I checked my IRD online and it shows no payments due so guess I don't owe anything. I am stopping using the Tax agent and going to process all my own using the IRD website.

Also in terms of filling a PTS it says:

you have tax to pay: stop - do nothing. This amount does not need to be assessed for payment.

Make sure you contact IRD to remove the tax agent, otherwise any refunds you receive will go to them, not you.

Geese

1028 posts

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Inactive user

#1477206 23-Jan-2016 10:47

I was self employed at one point, and thought I would do the "right thing" and used a tax agency. I thought if they do everything right, I can sleep easy at night knowing I haven't done it myself and tried my best but made a mistake I will be chased for.

How wrong was I, the tax accountant landed me in the deepest trouble of my life, they fraudulently dodged ACC on my behalf, then ACC woke up and came after me 3 years later for thousands of dollars. I rung tax agency and "fired" them, then called IRD and told them I was doing my own accounts from then on. I did the final year myself, and it was actually very easy.

I'll never use a tax agency again.

Hammerer

2480 posts

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Lifetime subscriber

#1477252 23-Jan-2016 11:42

Geese:

I'll never use a tax agency again.

You are right that doing your taxes yourself is not that hard for a small business. But I'd recommend that you think carefully before committing to a blanket statement - its called a blanket because it covers much more truth than it reveals - that is unlikely to be helpful to you or anyone else who reads your post.

On the basis of very limited experience with tax agents you are going to cut yourself off from the usual benefits provided by most tax agents. There are many good reasons for using tax agents that should outweigh the behaviour of one bad tax agent. They can have many things that you don't: knowledge, developed expertise, a good reputation with the tax authorities, a history of delivering net benefits to their clients, the benefit of extensions to IRD filing and payment deadlines, etc.

You are overreacting and this could end up "cutting off your nose to spite your face".

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Geese

1028 posts

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Inactive user

#1477277 23-Jan-2016 12:39

Hammerer: I'd recommend that you think carefully before committing to a blanket statement - its called a blanket because it covers much more truth than it reveals - that is unlikely to be helpful to you or anyone else who reads your post.

On the basis of very limited experience with tax agents you are going to cut yourself off from the usual benefits provided by most tax agents. There are many good reasons for using tax agents that should outweigh the behaviour of one bad tax agent. They can have many things that you don't: knowledge, developed expertise, a good reputation with the tax authorities, a history of delivering net benefits to their clients, the benefit of extensions to IRD filing and payment deadlines, etc.

You are overreacting and this could end up "cutting off your nose to spite your face".

Your absolutely right. I will stay out of this discussion now.