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Tax Administration Act 1994

Interest - Specific provisions

120KBC: Interest for AIM method provisional taxpayers

You could also call this:

"Interest on unpaid provisional tax for people using the AIM payment method"

Illustration for Tax Administration Act 1994

You use the AIM method to pay provisional tax. This method is described in section RC 5(5B) of the Income Tax Act 2007. You pay the right amount on time. You pay 6 or 12 instalments on the right dates. These dates are in sections RC 9 and RC 10B of the Income Tax Act 2007. Your residual income tax is due later. If you miss an instalment, it is a failed instalment. You must pay the rest of your residual income tax on your terminal tax date. This is according to sections RC 9 and RC 10B of the Income Tax Act 2007.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS38159.

Topics:
Money and consumer rights > Taxes
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120KBB: Interest for most standard method provisional taxpayers, or

"Interest rules for people who pay tax in parts throughout the year"

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120KC: Residual income tax of new provisional taxpayer, or

"Paying residual income tax in instalments for your income year"

Part 7Interest
Specific provisions

120KBCInterest for AIM method provisional taxpayers

  1. This section applies if, for a tax year,—

  2. a person is liable to pay provisional tax for the tax year and uses the AIM method described in section RC 5(5B) of the Income Tax Act 2007; and
    1. there is no provisional tax interest avoidance arrangement in relation to the person.

      1. If the person pays the amount of all 6 or 12 instalments, as applicable, on the instalment dates for the tax year in accordance with sections RC 9 and RC 10B of the Income Tax Act 2007, then, despite section 120KB(2) of this Act,—

      2. the person’s residual income tax for the tax year is not due and payable as set out in section RC 9 of the Income Tax Act 2007; and
        1. the amount of their residual income tax minus the total amount paid in relation to the instalments for the tax year is due and payable in 1 instalment on their terminal tax date.

          1. If the person fails to pay the amount of an instalment on the relevant instalment date for the tax year (a failed instalment) in accordance with sections RC 9 and RC 10B of the Income Tax Act 2007, then, despite section 120KB(2) of this Act, the person’s residual income tax for the tax year is not due and payable as set out in section RC 9 of the Income Tax Act 2007 for the instalment date.

          Notes
          • Section 120KBC: inserted, on (applying for the 2018–19 and later income years), by section 54(1) of the Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017 (2017 No 3).