Sleep Well #2: Know Your Dates
With the holiday season approaching and the beautiful sunny weather outside, you also might want to enjoy it all to its fullest. Your social calendar could be full of exciting events and parties, and some important business dates just might slip unnoticed… especially if it’s one of your first years in business.
What are the important dates for me?
There are different dates not to miss… Depending on your situation there could be quite a lot of them. And they can strike at the time when you expect them the least such as right after the holidays. Most often we’ve heard the following dates that are important for self-employed people not to miss:
- Taxes (IRD)
- Income tax
- Provisional tax
- Student loan (IRD)
- Interim payments
- ACC levies (ACC)
- Taxes (IRD)
- Returns (IRD)
- End of year tax return
- GST returns
Keep in mind that each situation is different and you might have additional dates. If you are registered as a company, there could be a lot more.
Taxes, ACC levies and IRD returns are the main important dates self-employed don’t want to miss
Case study: Freelance designer
Our client Lisa who is a freelance designer counted that she will have 10 deadlines with IRD and ACC after her first year in business. Lisa is a sole trader and has a student loan to repay. She didn’t have an accountant and therefore there are no extensions of time for return submission or payments. Lisa also became a provisional tax payer because her tax to pay at the end of the year exceeded $2,500. Here are the dates after Lisa’s first year in business:
- IR3 return due by 7 July 2017
- First payment of provisional tax due 28 August, 2017
- First interim student loan payment due 28 August, 2017
- ACC levy by 12 September 2017
- Second payment of provisional tax due 15 January, 2018
- Second interim student loan payment due 15 January, 2018
- Income tax payment due 7 February, 2018
- Student loan repayment du 7 February, 2018
- Third payment of provisional tax due 7 May, 2018
- Third interim student loan payment 7 May, 2018
If Lisa continues her business, she’ll have more dates to follow for the next years in her business, too.
What if I miss an important date?
Depending on the type of deadline that you miss, you might face penalties if you miss an important date. If you have a reasonable excuse the penalty might be waived. Contact the government agency to learn more and explain your situation. We’ve heard of multiple cases when the penalty was waived but we really recommend making payments on time. Also, if you are not able to make the payment in full, contact the agency, inform them about your situation and they might be able to create a repayment schedule for you with multiple smaller amount payments over a period of time.
How can I make sure I don’t miss any of the dates?
If you are registered with myIR, IRD could send you reminders of some or all of the important dates. IRD also has a web page where they’ve listed all the important dates. Also if you have a tax agent or accountant they might be able to help you with this information. Sometimes there is a perception that accounting software will tell you all the important dates. But the reality is that usually accounting software is not tailored to New Zealand’s tax system. Instead, you can try Bosspac – it will tell you how much and when to pay IRD and ACC, and help you have the peace of mind that you are not missing any important dates.
Have an interesting self-employment story to share? Have a topic that you want to hear about? We’d love to hear from you!
Self-employed? Bosspac makes it easy for you to take control of your government obligations. We’ll soon launch our beta product. Want to know when we go live? Join our waitlist or follow us on Facebook and Twitter.
The information provided here is of a general nature. It is not intended to be a substitute for professional advice.