New section 183ABAB is added to the Tax Administration Act 1994
Interest is charged when a taxpayer fails to make a payment of tax on time. The changes allow the Inland Revenue to remit interest on a late payment if the taxpayer’s ability to make the payment on time was significantly adversely affected by the COVID-19 outbreak
New rules would give the Commissioner the ability to remit interest that has accrued on tax payments due on or after 14 February 2020. Interest will not be remitted until core tax is paid in full.
At this stage the proposed rules apply till the next 24 months.
This change will help business to not incur additional cost if they are not able to make tax payments on time.
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