Snapshot of recent developments

Tax legislation and policy announcements

Public Remedials Log (September 2025)

The Public Remedials Log has been updated for September.

Ensuring FamilyBoost reaches more families – information release

On 2 October 2025, Inland Revenue published the information release for documents relating to Income Tax (FamilyBoost) Amendment Act 2025.

Croatia and New Zealand initial tax treaty

On 3 October 2025, the Croatian Government published information that representatives of Croatia and New Zealand have initialled an income tax treaty. It must be signed and ratified by both contracting parties before entering into force. 

Act Commentary: Income Tax (FamilyBoost) Amendment Act 2025

On 7 October 2025, Inland Revenue published the Act Commentary for the Income Tax (FamilyBoost) Amendment Act 2025 which received Royal assent on 23 September 2025. The commentary provides an explanation of the changes made by the Act, which introduces adjustments to the FamilyBoost tax credit settings.

Taxation (Annual Rates for 2025-26, Compliance Simplification, and Remedial Measures) Bill – information release

On 9 October 2025, Inland Revenue published an information release including documents relating to Taxation (Annual Rates for 2025-26, Compliance Simplification, and Remedial Measures) Bill. 

Working for Families scheme – summary of consultation

On 10 October 2025, Inland Revenue and the Ministry of Social Development released a summary of the main themes that emerged from consultation on proposed changes to the Working for Families scheme. All matters raised in the discussion document are being considered further and could be subject to further consultation.

Racing Industry (Closure of Greyhound Racing Industry) Amendment Bill

On 13 October 2025, the Government introduced the Racing Industry (Closure of Greyhound Racing Industry) Amendment Bill, which proposes to close the greyhound racing industry and includes consequential amendments to Tax Acts:

• GST Tax Act 1985: In s 5(11CB), deletes “or greyhound”.
• Income Tax Act 2007: Repeals s CW 47(1)(d).

Inland Revenue statements and guidance

Public Guidance Work Programme update (October 2025)

On 1 October 2025, Inland Revenue issued an updated public guidance work programme.

Tax Information Bulletin: October 2025

On 1 October 2025, Inland Revenue issued TIB Vol 27, No 9 (October 2025):

New legislation

• SL 2025/151: Income Tax (Fringe Benefit Tax, Interest on Loans) Amendment Regulations (No 2) 2025.
• SL 2025/150: Income Tax (Deemed Rate of Return on Attributing Interests in Foreign Investment Funds, 2024–25 Income Year) Order 2025.

Ruling

• BR Prd 25/04: PPS Mutual Limited.

Operational position

• OP 25/02: Commissioner’s operational position on the FBT treatment of open loop cards provided by employers to employees.

Interpretation statements

• IS 25/19: Income Tax – Whether an off-market share cancellation is made in lieu of the payment of a dividend.
• IS 25/20: Student Loans – Overseas borrowers and their obligations.

General article

• GA 25/01: Tax on any fees paid to a member of a board, committee, panel, review group or task force.

Technical decision summaries

• TDS 25/21: Omitted income and shortfall penalty.
• TDS 25/22: GST – supply of accommodation.

Overdue employer and GST debt and returns

On 1 October 2025, Inland Revenue announced a targeted campaign aimed at taxpayers with debt less than 12 months old, for clients who have already been through Inland Revenue’s full billing cycle but have not yet responded. As part of this initiative, Inland Revenue will be reaching out to them again.

Updated calculator for FamilyBoost changes

On 1 October 2025, Inland Revenue announced an updated calculator to help families work out if they can get more support through FamilyBoost is now available on the Inland Revenue website.

PAYE offending ends with home detention sentence

On 1 October 2025, Inland Revenue provided the details of a Christchurch man who was sentenced to 10 months home detention for deducting PAYE from his workers’ wages but not passing it on to Inland Revenue.

System update complete – new ‘debt collection’ tab

On 5 October 2025, Inland Revenue confirmed they had successfully completed their system update. After the system update a new tab has appeared on some taxpayers myIR pages “debt collection” which gives greater visibility over debt.

Two-step verification is compulsory for all myIR users and text message is now available

On 6 October 2025, Inland Revenue announced that two-step verification (2SV) was compulsory for all myIR users and text message is now available for 2SV.

Final-year Fees Free comes to Inland Revenue

On 6 October 2025, Inland Revenue announced that it is now responsible for supporting tertiary learners with final-year Fees Free information, assessing learner eligibility and paying entitlements.

Final-year Fee Free covers fees for the final year of study or final 2 years of work-based learning, up to $12,000. Learners enrol for study or work-based learning and pay their fees. They can apply for Fees Free after they have completed their qualification or programme.

Learners can apply for Fees Free in myIR from 15 January 2026.

First-year Fees Free finished on 31 December 2024.

GST - Taxable activity interpretation statement                                                           

On 8 October 2025, IR issued IS 25/21: GST - Taxable Activity. The interpretation statement sets out the Commissioner of Inland Revenue’s view on the meaning of “taxable activity”. The Commissioner has discussed this concept in numerous public items, but generally in a specific context. This statement is of more general application.

The concept of taxable activity is a fundamental principle for GST, without a taxable activity there is no requirement to register or charge for GST. As such, it is considered useful that the Commissioner provide his view of the meaning of “taxable activity”.

The key elements of taxable activity discussed in this interpretation statement are:

• what constitutes an “activity”.
• when an activity is being “carried on”.
• what “continuously or regularly” means.
• the significance of the words “whether or not for a pecuniary profit”.
• what is meant by the requirement that the activity “involves or is intended to involve, in whole or in part, the supply of goods and services … for a consideration”.
• the reference to the activity being “carried on in the form of a business, trade, manufacture, profession, vocation, association, or club”.
• the inclusion of public authorities, local authorities and public purpose Crown-controlled companies.
• the application of section 6(2) (“anything done in connection with the beginning or ending … of a taxable activity”).
• the exclusions from the definition of “taxable activity” in section 6(3), particularly the exclusions for any activity carried on essentially as a private recreational pursuit or hobby (sections 6(3)(a) and 6(3)(aa)).

The guidance includes a number of examples of when the Commissioner does and does not consider there is a taxable activity.

Withdrawal of General Article “Information Sharing with Approved Credit Report Agencies”

On 8 October 2025, Inland Revenue withdrew the General Article Information Sharing with Approved Credit Reporting Agencies. The Commissioner of Inland Revenue is reviewing his approach to the credit reporting legislation in the Tax Administration Act 1994 to give full effect to Parliament’s purpose for the credit reporting rules.

Overdue employer and GST debt and returns

On 8 October 2025, Inland Revenue provided further information on a targeted campaign on overdue employer and GST debt returns.

Ignoring tax debt won’t make it go away

On 13 October 2025, Inland Revenue issued a media release on tax debt, which included:

• Inland Revenue has started to call taxpayers with relatively small overdue GST/EMP tax (debt of over $1,000 between 6 months and 5 years old).
• If the debt is more than $10,000 Inland Revenue will ‘remind’ of possible legal consequences.
• Since mid-June Inland Revenue has sent out 16,500 notices about planned bank deductions – 25% more than for the whole of last year.
• Between mid-June and September 30, 8,181 deductions were completed with $17m of debt recovered. 

Changes to the tax agents’ phone line coming 13 October

On 8 October 2025, Inland Revenue announced changes are being made to the tax agents’ phone line from Monday 13 October 2025.

When Inland Revenue is unable to accept new calls on the tax agent’s line:

• There will be a message at the start of the call instead of going through Inland Revenue’s SPK2IR phone system.
• The call will then be disconnected.

These changes apply only to the tax agents’ phone line.

Withdrawal of Imaging of electronic storage media standard practice statement

On 10 October 2025, Inland Revenue withdrew SPS 10/02: Imaging of electronic storage media. SPS 10/02 was published in 2010 and has been superseded by OS 25/04: The Commissioner of Inland Revenue’s search powers and OS 25/05: Section 17B Notices.

Systems update and shutdown on 6 and 7 December 2025

On 14 October 2025, Inland Revenue announced a system update to take place over the weekend of Saturday 6 and Sunday 7 December. During this period myIR, gateway services, self-service phonelines and other systems will be unavailable.

Inland Revenue Annual Report 2024-25

On 20 October 2025, Inland Revenue published its 2024-25 Annual Report. This year’s annual report outlines the Inland Revenue’s performance under a new structure. Some highlights from the report are

• Total tax revenue for the year was $116.6b:
  • Individual tax: $60.4b (52% of tax revenue)
  • GST: $29.3b (25% of tax revenue)
  • Corporate tax: $19.7b (17% of tax revenue)
  • Other tax: $7.2b (6% of tax revenue).
• Inland Revenue met 26 of 31 output performance measures (84%), up from 76% last year.
• The return on investment from compliance intervention was $11.81 for every dollar spent, compared to $9.50 in 2024.
• 7.2m employer information returns were filed 2024-25.
• 437,000 company returns were filed (2024 year).
• 712,000 taxpayers were registered for GST (2024-25), filing 3.19m GST returns.
• 1.94m income tax returns were filed (2024 year).
• It cost Inland Revenue $0.46 to collect $100 in tax (in 2025 $0.45, 2024, $0.43 and prior to Business Transformation (2015) $0.80).
• Compliance activities:
  • 17,940 field visits
  • 7,641 audits opened (49% increase)
  • 6,147 audits closed (42% increase)
  • 28,530 Voluntary Disclosures (1% increase)
  • 88,367 deduction notices (19% increase).
• Inland Revenue has 4,526 full-time employees (up from 4,384 in 2024) with an average age of 45 and average length of service of 12.7 years (down from 15.5 years in 2021).

Draft Interpretation Statement: GST treatment of supplies of payment processing or facilitation services to merchants

On 20 October 2025, Inland Revenue published draft guidance PUB00515: GST treatment of supplies of payment processing or facilitation services to merchants.

The draft guidance applies to entities that provide payment processing or facilitation services, including payment technology, to merchants. These entities include payment service providers (PSPs), by now, pay later (BNPL) providers and other suppliers of payment technology or infrastructure. The draft Interpretation Statement provides a framework to determine whether services provided to merchants are financial services. When the supply to merchants includes settlement services, there will be a supply of financial services, and these supplies will be GST exempt (or zero rated if applicable). The draft Interpretation Statement also explains whether there is a single supply or multiple supplies of services that may have different GST treatments.  

Deadline for submissions is 8 December 2025.

Changes to sharing information about unpaid tax

On 21 October 2025, Inland Revenue announced it has made changes to how it shares information about unpaid tax (credit reporting) to a credit agency.

Starting 13 October 2025, Inland Revenue are running a pilot where selected businesses will be formally notified of their outstanding debt. If businesses contacted do not take positive action—such as setting up an instalment arrangement—they will be credit reported.

Businesses will have 30 days to respond before any credit reporting takes place.

The formal notification (Notice of Intent) will appear in the company’s myIR account on the day that the notification is couriered to the company’s registered office. The 30-day response period starts from the date the notification is delivered to the registered office.

'Reasonable efforts' now include Inland Revenue sending its standard overdue reminders and options for repayment, but the business has not yet engaged with Inland Revenue.

'Formal notification' to the company is now sufficient—not all individual directors will be notified.

GST returns filing – due on 28 October

On 22 October 2025, Inland Revenue provided some reminders to assist it processing returns as it enters into a busy GST return filing period.

Questions we’ve been asked: Public private partnership projects and business continuity test for losses

On 23 October 2025, Inland Revenue issued QB 25/21: Income tax – Public private partnership projects and business continuity test for losses. It addresses whether transitioning from the design and construction (D&C) phase to the operation and maintenance (O&M) phase constitutes a “major change” in business activities under the business continuity test (BCT). Inland Revenue concluded that while this transition could be considered a major change, it qualifies as a “permitted major change” due to the close economic, legal, and financial connection between the two phases. Therefore, even if there is a breach in ownership continuity, a corporate Contractor or its limited partner may still carry forward tax losses, provided other BCT requirements are met and anti-avoidance provisions do not apply.

Severe weather conditions in late October

On 24 October 2025, Inland Revenue announced that clients that have been affected by recent severe weather do not need to contact Inland Revenue right now and instead should focus on recovering from the damage caused. When they can, they should get in touch via myIR including the word 'weather' or call Inland Revenue on their disaster line 0800 473 566.

Draft Interpretation Statement: Working for Families tax credits and family scheme income

On 24 October 2025, Inland Revenue issued PUB00513: Working for Families tax credits and family scheme income and an accompanying fact sheet.

This interpretation statement gives an overview of eligibility for Working for Families tax credits and discusses the adjustments required to a person’s net income to determine family scheme income. Key adjustments that may be relevant are income from associated trusts and companies, passive income over $500 of dependent children, payments from trusts other than beneficiary income and other payments supporting the family if they total more than $5,000.

The deadline for submissions is 9 December 2025.

Case summaries

Case summary: CSUM 25/12 High Court refuses to grant stay of liquidation pending outcome of judicial review proceeding

On 20 October 2025, Inland Revenue published CSUM 25/12. The Commissioner of Inland Revenue commenced liquidation proceedings against KD Transport Limited (KD). KD requested relief under s 177 of the Tax Administration Act 1994 which the Commissioner of Inland Revenue declined. KD sought judicial review of the Commissioner’s decision declining its proposal for relief and also applied to stay the liquidation proceeding, pending determination of its judicial review application. The stay application needed an extension of time as it was made outside the five working day period prescribed in the High Court Rules. The application for an extension of time was dismissed, and the Associate Judge made an order liquidating KD.

Technical decision summaries

TDS: Disposal of cryptoassets (Adjudication)

On 6 October 2025, Inland Revenue published TDS 25/23 Disposal of cryptoassets (a disputes adjudication). The taxpayers jointly held cryptoassets (Crypto Y) and claimed their investment was for long-term returns via future staking rewards, but they made significant disposals shortly after purchase and reinvested proceeds into other assets and back into Crypto Y. Despite later earning staking rewards and reporting income and expenses in their tax returns, they sought to reverse these via a Notice of Proposed Adjustment. Inland Revenue rejected the reversal, and adjudication upheld that the disposals and staking rewards were taxable: the crypto was acquired for disposal (s CB 4), involved a profit-making scheme (s CB 3), and staking rewards were income under ordinary concepts (s CA 1(2)).

TDS: The supply of accommodation in a serviced apartment (Private Ruling)

On 22 October 2025, Inland Revenue issued TDS 25/24: The supply of accommodation in a serviced apartment. It considered whether the provision of serviced apartment accommodation in a retirement village, bundled with a mandatory hospitality package, constituted a taxable supply of accommodation in a “commercial dwelling” under s 2(1) of the GST Act 1985. The hospitality package included services such as meals, cleaning, health checks, emergency monitoring, and recreational access. Residents entered into occupation right agreements and paid monthly fees for these services. The Tax Counsel Office ruled that the arrangement met the definition of a “commercial dwelling” and was therefore a taxable supply for GST purposes.

TDS: Restructure and transfer of shares (Private Ruling)

On  24 October 2025, Inland Revenue issued TDS 25/25: Restructure and transfer of shares. It considered whether a future sale of shares transferred during a group restructure would be taxable under s CB 4 under the Income Tax Act 2007. The restructure involved transferring investment assets, including shares in Company A, from the parent company to a wholly owned subsidiary to streamline administration and reduce compliance costs. Although a potential sale of Company A had been signalled due to liquidity concerns, no commitment to sell existed. The Tax Counsel Office ruled that s CB 4 would not apply to any future sale of the shares, provided the subsidiary’s dominant purpose in acquiring them was not to dispose of them.

OECD updates

Argentina ratifies BEPS Convention

On 29 September 2025, Argentina deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (BEPS Convention). The BEPS Convention will enter into force on 1 January 2026 for Argentina.

OECD Secretary-General Tax Report to G20 Finance Ministers and Central Bank Governors

On 15 October 2025, the OECD Secretary-General presented his tax report to G20 Finance Ministers and Central Bank Governors during the G20’s meeting in Washington D.C. The report sets out recent developments in international tax co-operation, including the OECD’s support of G20 priorities such as the implementation of the BEPS minimum standards, the Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy, and tax transparency. At the request of the South African G20 Presidency, the report also presents the following materials: an Inclusive Framework stocktake report on BEPS implementation and impact over the past ten years; and a voluntary international framework approved by the OECD Committee on Fiscal Affairs to promote the automatic exchange of readily available information on real estate.

Platform for Collaboration on Tax Publish the Report on Progress in Strengthening Frameworks for Building Tax Capacity

On 15 October 2025, the Platform for Collaboration on Tax (PCT) released a new report on Progress in Strengthening Frameworks for Building Tax Capacity. The report responds to the February 2025 G20 request for the PCT and regional organisations to coordinate and report on efforts to enhance the effectiveness and efficiency of technical assistance in tax capacity building, as emphasised in the Rio de Janeiro G20 Ministerial Declaration on International Tax Cooperation.

Brazil signs the Multilateral BEPS Convention

On 20 October 2025, Brazil signed the BEPS Convention.

OECD published transfer pricing countries profiles

On 22 October 2025, the OECD published a new batch of updated transfer pricing country profiles, reflecting the current transfer pricing legislation and practices of 25 jurisdictions and including for the first time the profiles of Cabo Verde, Guatemala, Thailand, UAE, and Zambia.

Note: The items covered here include only those items not covered in other articles in this issue of Tax Alert.