IRD system error gives tax filers more time

Wednesday 8th July 2009

A "system error" on the Inland Revenue Department's (IRD) website has given some breathing space to people rushing to file their tax returns online for the 2008 financial year.

The government's gatherer of taxes pushed out the deadline for IR3, IR4 and IR7 online returns to midnight on Friday after the system "failed intermittently", a spokeswoman for the department said.

The government's largest department is unsure what caused the error, and is looking into it.

The affected returns cover annual returns for independent contractors, companies and partnerships.

While IRD's response to extend out the deadline was "quite a pleasant move" for people who would blame themselves for the problem, Jo Doolan, tax director at Ernst & Young New Zealand, said the problem highlights the need for the department to beef up its online capacity.

With all of the extra responsibilities it's taken on such as KiwiSaver and Working for Families, "Inland Revenue needs to seriously invest in their computer systems," she said.

In a statement on its website, the IRD apologised for any inconvenience and said any online returns received before midnight July 10 won't face a late filing penalty.

The country's tax revenue for the 11 months through May was in line with expectations, although company tax receipts were $400 million lower than expected as provisional tax payments were dented by sliding corporate earnings, according to The Treasury.

Treasury Secretary John Whitehead last month mooted the introduction of a capital gains tax and higher GST to offset lower personal and corporate tax rates, but his suggestion was slapped down by Prime Minister John Key.

Businesswire.co.nz

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