Who could be entitled to a tax refund?

The annual tax refund season runs at the start of each new financial year, after the Inland Revenue Department has confirmed income details, and those who are entitled to a refund could have the money in their account around the end of June. So how do you know if you are owed a refund on your income tax? A huge number of people unknowingly overpay their tax each year, ranging from those who are working whilst still at school, to income-earning parents who pay preschool fees, to backpackers who only work for part of the tax year, and a whole host of others in between. Often it’s simply a case of the employer not deducting the correct amount of tax.

Those who worked for part of the financial year This category mainly covers backpackers who worked for just part of the year whilst travelling around the country, those who were made redundant part way through the year, expats who started working in New Zealand in the middle of the year, and all those who entered the workforce after the start of the financial year. Even if you have left the country, you are still entitled to a refund and can apply for it from abroad.

Those who received a lump sum payment Whether you received a lump sum payment as an annual or one-off bonus, as a redundancy pay-off, retirement payment, back pay, or if you have cashed in your annual leave, that money is often taxed at a lower rate (depending on your income).

Those who had more than one employer within the financial year If you have had more than one job, with different employers, you could be eligible for a tax refund.

Those who earned less than $9,880 If you earned under $9,880 in any year up to and including the 2012 tax year, you can claim a tax credit for every week you were in paid employment for 20 hours or more. If you didn’t claim this tax credit, you are owed an income tax refund. Unfortunately, the IRD are removing the tax credit for annual income under $9,880 from the 2013 tax year so this is the last year you will be eligible for it. It’s important to note that you can only claim the tax credit of income under $9,880 or the tax credit for children, not both.

Those who have expenses to claim There are a number of tax-deductible expenses, therefore if you haven’t claimed any or all of your expenses you will be eligible for a tax refund.

Those who are entitled to the independent earner tax credit but didn’t claim all of it during the financial year If your annual income is between $24,000 and $44,000 and neither you nor your partner receive working for families tax credits or any income-tested benefit, you are eligible to receive a tax credit of $520 for the year. If you are an independent earner but earn over $44,000 your annual entitlement decreases by 13 cents for every additional dollar earned.

Those salary and wage earner who unknowingly have overpaid tax. A tax agent like My Refund can check for you.


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