How to pay tax
If you're earning any sort of income, you have to pay tax. Make sure you're paying the right amount so you don't end up with a large bill.
If you’re earning wages and you're on the right tax code, you shouldn't have to do anything at the end of the tax year.
Your employer will deduct tax using the code you gave them when you started work. Make sure they’re using the right code or you could pay the wrong amount of tax.
You can work out how much tax should be taken from your wages.
If you get a lump sum payment when you leave your current job, eg holiday pay or redundancy payment, you’ll need to pay the correct tax on it.
If you’re self-employed you’ll need to manage your own tax and file a return at the end of the tax year. IRD will consider you a one person business.
Make sure you know how to:
- keep records
- claim expenses
- charge GST if you need to.
At the end of the tax year
Most people who earn salary or wages pay the correct amount of tax and don't need to do anything at the end of the tax year.
You might need to check your tax or file a return if you:
- earned income that had no tax deducted (this includes rental properties)
- paid too much or not enough tax during the year
- received more than $200 of interest, dividends or Māori authority distributions
- received income from an investment that was taxed incorrectly
- had more than one job during the year
- worked for only part of the year
- can claim expenses on your income.
You’ll automatically be sent a personal tax summary if you:
- received Working for Families
- used the wrong tax code
- used a special tax code
- used a casual agricultural employee (CAE) or an election day worker (EDW) tax code and earned more than $200 from that source
- paid your own tax to IRD
- have a student loan.