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Income Tax Act 2007

General collection rules - Provisional tax - Table R1: Summary of instalment dates and calculation methods for provisional tax

RC 13: Paying 2 instalments for tax year

You could also call this:

“When you need to pay two instalments of provisional tax instead of three”

You need to pay two instalments of provisional tax in certain situations. This applies if you’re new to business and start within a specific timeframe, or if you’re an existing taxpayer with some special circumstances.

If you’re new to business, this rule applies if your first business day is between 30 days before instalment B and 30 days before instalment D.

If you’re an existing taxpayer, this rule might apply if you provide your tax return for the previous year between instalment B and instalment D. This can happen if you got extra time to file your return. Also, your tax from two years ago needs to be $5,000 or less.

However, if you pay GST every six months, this two-instalment rule doesn’t apply to you.

If this rule does apply to you, you’ll pay your instalments on the dates of instalment D and instalment F in your income year. The amount you need to pay for each instalment is worked out using section RC 10.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1519839.

Topics:
Money and consumer rights > Taxes
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RC 14: Paying 1 instalment for tax year, or

“When you only need to pay one instalment of provisional tax for the year”

Part R General collection rules
Provisional tax: Table R1: Summary of instalment dates and calculation methods for provisional tax

RC 13Paying 2 instalments for tax year

  1. This section applies for a tax year to—

  2. a person with an initial provisional tax liability whose first business day occurs in the period that starts 30 days before the date of instalment B and ends 30 days before the date of instalment D; or
    1. a person liable to pay provisional tax whose return of income for the preceding tax year is provided in the period that starts on the date of instalment B and ends on the date of instalment D if—
      1. they were required to provide a return for the preceding tax year but, under section 37 of the Tax Administration Act 1994 or an extension under that section, are not required to provide the return by the date of instalment B; and
        1. their residual income tax for the tax year before the preceding tax year was $5,000 or less.

        2. Despite subsection (1), this section does not apply to a person liable to pay provisional tax who pays GST on a 6-monthly basis.

        3. The instalments are payable on the date of instalments D and F for the person’s corresponding income year.

        4. The amount of each instalment is calculated under section RC 10.

        Compare
        Notes
        • Section RC 13(1)(b)(ii): amended, on , by section 25(1) (and see section 25(2) for application) of the COVID-19 Response (Taxation and Social Assistance Urgent Measures) Act 2020 (2020 No 8).
        • Section RC 13(3): amended, on , by section 172(1) (and see section 172(2) for application) of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Act 2020 (2020 No 5).