171Interest on unpaid levy

1. If a person does not fully pay, by the due date, any levy payable under this Act (the original amount), the chief executive may make a written demand for the payment of interest on the part of the original amount that remains unpaid.

2. The person is liable for the interest payable and the interest must be calculated for every month or part of a month after the due date during which the original amount remains unpaid in full.

3. Interest must be calculated in accordance with the following formula:

   $a\; =\; (b\; \times \; c)\; ÷\; 12$

   Where:

   • a a

     is the interest payable

   • b b

     is any part of the original amount that remains unpaid at the end of the month for which the interest is calculated

   • c c

     is the taxpayer’s paying rate, as defined in section 120C of the Tax Administration Act 1994.

4. Any payment the chief executive receives or applies on account of the person’s liability to pay an original amount must first be applied towards payment of the interest.