We are now well through the tax year with time running out for the completion of 2023 tax returns. No doubt the electoral changes will also result in many changes to the tax system in the 2024 year.
One area of Inland Revenue Compliance focus at the moment is on the Horticulture industry in relation to certificates of exemption and the provision of labour services. If you are an orchardist paying for services that are substantially for the provision of labour, then the following rules apply!
These labour services are covered by the scheduler payments regime and If you engage contractors for this type of work you must have:
- An updated Certificate of Exemption (with an expiry date in the future) which means that no scheduler tax is required to be deducted or reported, or
- An IR330C with an updated Tailored Tax Rate (with an expiry date in the future) allowing a rate of scheduler tax to be deducted at the specified rate (0-9%), or
- An IR330C with a contractor elected rate of at least 10%. No annual re-election is required if the contractor has elected their rate.
- Where none of the three options above apply (i.e. no IR330C supplied) then scheduler tax must be deducted at 45%.
The amounts deducted need to be reported and paid to Inland Revenue as part of an Employment Information form.
Please be aware that Inland Revenue may contact you, or your client directly, where it has been identified that scheduler tax (WT) has not been reported or paid to Inland Revenue.
If you have any issues over the above or other tax or accounting issues, please don’t hesitate to get in touch with our office.
