Income Tax Act 2007

General collection rules - Withholding tax on retirement scheme contributions - Calculating amounts of tax

RH 6: Calculating amounts of tax on failure to withhold

You could also call this:

"Working out tax when it's not taken out of retirement savings"

You need to calculate the amount of tax when a retirement scheme contributor or retirement savings scheme does not withhold tax for a contribution. This happens under section RH 2(4). You use a formula to work it out. You use the tax rate, the amount contributed to the scheme, and the tax already paid to calculate the amount. The tax rate is found in a schedule. The amount contributed to the scheme is the amount received, excluding tax. The tax already paid is any tax already paid for the contribution. You put these numbers into the formula to find the amount of tax. The formula is: (tax rate ÷ (1 − tax rate) × contribution to scheme) − tax already paid.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1690727.

This page was last updated on 5 April 2026 — View changes

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Part RGeneral collection rules
Withholding tax on retirement scheme contributions: Calculating amounts of tax

RH 6Calculating amounts of tax on failure to withhold

This section applies when a retirement scheme contributor or retirement savings scheme does not withhold an amount of tax for a retirement scheme contribution under section RH 2(4).
The amount is calculated using the formula—
$(tax rate ÷ (1 − tax rate) × contribution to scheme) − tax already paid.$

Where:
In the formula,—
tax rate is the rate of RSCT for the person set out in schedule 1, part D, clause 7 (Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits):
contribution to scheme is the amount of the retirement scheme contribution received by the retirement savings scheme excluding the amount of tax:
tax already paid is any amount of tax for the contribution that has already been paid.

Compare

2004 No 35 s NEB 4(1)

Notes

Section RH 6: inserted, on 1 April 2008, by section 545 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).