Inland Revenue has provided further guidance on Small Business Cashflow (loan) Scheme, as well as phone delays and changes to Use of Money Interest rates.
Small Business Cashflow (loan) Scheme
Use of Money Interest (UOMI) rate change
The rate charged on underpaid tax will decrease from 8.35% to 7.00%, while the rate for overpayments of tax will decrease from 0.81% to 0.00%. The new rates will apply from Friday 8 May 2020.
A Use of Money Credit Interest Rate of 0.00% means that there will no longer be any credit interest paid where any credit is held with Inland Revenue. This includes KiwiSaver contributions paid to Inland Revenue before being passed on to Scheme Providers.
The rates are reviewed regularly to ensure they are in line with market interest rates. They were last changed in August 2019. IRD states that the new rates are consistent with the floating first mortgage new customer housing rate and the 90-day bank bill rate.
Delays in IRD answering calls
IRD’s contact centres have reduced capacity due to staff working from home and the need to maintain social distancing in their offices.
As a result, IRD’s phone services will be severely limited. IRD are prioritising social policy contacts like Working for Families and Child Support, and supporting businesses with COVID-19, for example administering the Government’s Small Business Cashflow Scheme.
The only effective way to contact the IRD continues to be online and through the myIR portal. Web messages are the best way to ask them any questions and IRD have additional staff responding to these at present.
IRD state “Given the ongoing impacts of COVID-19 we anticipate we’ll need to operate in this way for some time. Thank you for your patience in what is a difficult time for all New Zealanders.”
If you would like to discuss any of the available relief packages, or recent changes from the Government that may affect your business, please contact our team at Nexia NZ who are here to assist you or offer advice.
May 11, 2020