Get more flexibility and retain greater control of your tax payments.
Retain control of tax payments by depositing
The benefits of tax pooling extend well beyond saving on interest costs.
By making all your provisional tax payments through a tax pool, your clients retain a level of control over how their tax payments are managed that is not available by paying Inland Revenue directly.
Having your clients’ funds in a tax pool will ultimately provide flexibility to speed up, slow down, or refund their tax payments.
How does it work?
Deposits are held in the tax pool and can be transferred to Inland Revenue whenever it suits your client.
If your client has deposited funds under the standard uplift into the tax pool and you find that their actual RIT is lower than what was paid under the standard uplift, your client can sell or swap the extent of any excess amount(s) paid, earning premium interest through Tax Traders.
When depositing into the tax pool on a certain date, you are locking in the tax at this date. This means it can be transferred across to Inland Revenue at the date of deposit and reduce interest exposure when/if it is transferred across.
If your client has paid the right amount, or more than enough into the tax pool at the correct dates, the tax deposits can be quickly and easily transferred through to their Inland Revenue account at no cost.
If it turns out your client’s tax has been underpaid for the income year, deposits in the pool can be swapped to minimise any shortfall before purchasing the difference.
If your client needs their deposited funds back in cash, they can sell their deposits through the pool (earning premium interest). These funds are then paid into their bank account subject to any Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) checks as required.
Taxi
Your clients can also use our Deposit Offset facility to access credit secured against their tax deposits if they need working capital back in their business. Any funds accessed in this way will need to be repaid prior to 75 days after your client’s terminal tax date for that income year if they are needed to meet a tax liability for that income year. For more information, refer to Introducing Taxi.
Benefits
- Online account to manage tax balances any time.
- Smooth tax payments across the financial year.
- Receive premium interest on surplus tax.
- Fast refunds when your client wants them, even during the income year with the ability to reinstate payments if necessary.
- Avoid late payment penalties and reduce debit use of money interest costs on underpaid or late paid tax.
- No minimum deposit amount.
- Pay up until 11pm on provisional tax payment date.
- Payments lodged automatically with Inland Revenue.
- No need for same-day cleared payments.
- No account fees or set-up costs.
- Associated entities included in a single account.
Deposits with another tax pool?
It is easy to transfer deposits from another tax pool to Tax Traders’ tax pool, within 48 hours, retaining all historical data so your clients can benefit from all that only Tax Traders can offer. Contact one of our specialist team for assistance.
Criteria
- Deposit payments must be made into the Tax Traders deposit account (see details below).
- Any changes to payments must be completed and transferred to Inland Revenue within 75 days of your client’s terminal tax date.
- The deposit process is designed for income tax. In emergencies, funds paid into a tax pool can be applied to other tax types subject to certain criteria. If you would like to find out more about this, please contact one of our specialist team.
Do it all online in just a few minutes
Deposits of any amount can be made at any time into our deposit account, as long as it has the right references (as below). These payments will hold the date of deposit within the tax pool.
If you desire a Deposit Notice, which has the desired amount as well as the correct payment details, then within your client dashboard, select Manage Tax > Deposit Instructions (the last option on the list).
Ensure the taxpayer displayed is correct, as well as the balance date and tax date as expected (For a custom date, please select the ''Custom dates'' button underneath the taxpayer name). You are then able to enter an amount to be deposited in the pool. Once the information showing is as expected, you can either click ''Email Deposit Notice'' to email to an account associated with the taxpayer or ''Download Deposit Notice'', to directly download the notification.
Please note that the creation of a deposit notice does not put in place a deposit arrangement, the money is only counted as being deposited in the pool once it has been paid and applied to the taxpayer's account.