The right recipe for tax debt resolution.
The right recipe for tax debt resolution
When you fall into the boiling pot that is tax arrears in NZ, IRD ensure that ‘paying it next month/when you can’ is an option that rarely works.
Adding a pinch of heinous interest and a dash of penalties – both late filing and late payment – means that within just one month, your forgotten PAYE return could have increased by over $250.
Imagine you lost the contract that has been getting you by, knowing another opportunity is coming up in 6 months, you don’t file or pay PAYE or GST for 5-6 months, thinking that the next contract will get you back on track.
Your average GST is $3k, average PAYE is the same.
In just 6 months, you are now over $30,000 in debt, with several thousand dollars of interest and penalties.
You try and pay the arrears, but, they keep rising, interest compounding daily – meaning you can’t pay your current taxes – or make a dent in the arrears you owed due to the penalties. You’re metaphorically swimming in pancake batter, getting nowhere.
Tax Debt Management always requests that penalties are wiped to enable our clients to concentrate on their current compliance – and address any arrears fairly.
If you meet the hardship provisions – we can go further than that and request a total hardship write off – the largest write off ever received by TDM was over $300k – so no amount is out of the question.
Sometimes Case Managers just need the right ingredients, presented to them in the right way – and we know what that is. A steady mix of tax administration law, with a sprinkling of your story and a commitment to whisk you away from the stress of dealing with IRD.
By Rosie Gallagher