Inland Revenue is increasing it’s campaign to recover outstanding tax debt, especially for overdue employer taxes and GST. They are actively attempting to contact taxpayers with overdue debt in these tax types. If they fail to make contact to set up a preapproved instalment arrangement for the repayment of the debt, they can take action to obtain bank deductions directly from the taxpayer’s bank accounts.
Inland Revenue has issued a new Interpretation Statement to define their view on the meaning of taxable activity, which is a central concept for GST purposes. The statement defines the Commissioner’s view as to whether the taxable activity is being ‘carried on’ (there is an exclusion for private recreational pursuit or hobby), ‘continuously or regularly’, and whether or not for pecuniary profit (but noting that it must be a supply of goods or services for a consideration). While taxable activity has been discussed by Inland Revenue in specific contexts in the past, the statement is of more general application and will provide guidance for those cases where it is not clear whether the statutory definition of taxable activity has been met to satisfy GST registration.
Finally, a note for Incorporated Societies that they must reregister their Society before 5 April 2026 under the new Incorporated Societies Act 2022. Failure to reregister will result in the loss of their status as an Incorporated Society, and they would therefore need to be wound up. Parliament has rejected advice to extend the deadline despite nearly 50% of societies so far failing to reregister.
If you have any queries over tax or accounting issues, please get in touch with our office for further explanations.
