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Writer's pictureSasha Curin

October Newsletter

This month’s newsletter brings you key updates and announcements from the tax sector. We cover the Reserve Bank's recent update on the Official Cash Rate (OCR), which has been reduced by 50 basis points to 4.75%, providing potential relief to borrowers and businesses.

 

Also, please be aware of the scheduled IRD system shutdown over Labour Weekend, from 25 October to 29 October, during which myIR and related services will be unavailable.



Summary of Recent Updates


Reserve Bank Cuts OCR to 4.75%

The Reserve Bank has recently cut the Official Cash Rate (OCR) by 50 basis points, bringing it down to 4.75%. This marks the second consecutive OCR cut as the bank aims to address subdued economic activity and slow consumer spending.

 

With inflation now within the Reserve Bank's target range of 1% to 3%, this reduction is expected to help ease financial pressure on borrowers. Banks have already responded by lowering their lending rates, which should provide relief to homeowners and businesses alike. ASB, for example, has announced a reduction in its variable home loan rate to 7.89%, with other banks expected to follow suit.

 

The lower OCR also has implications for the property market. Buyers are likely to benefit from reduced borrowing costs, potentially increasing property market activity in the coming months. However, on the flip side, savings account interest rates are also being adjusted downwards, which may impact savers.


This change will be monitored closely by the Reserve Bank, with further adjustments dependent on upcoming economic data and conditions. 



New Tourist Levy in Effect

As of 1 October 2024, New Zealand’s International Visitor Conservation and Tourism Levy has increased from NZ$35 to NZ$100. Originally introduced in 2019, the levy is intended to help maintain public services and enhance tourism infrastructure. While the government believes the increased fee will support economic growth, there are concerns from the tourism industry that the higher cost could discourage visitors, especially as the sector continues to recover from the impacts of COVID-19 and border closures.



Important Notices


Inland Revenue System Shutdown Over Labour Weekend

Inland Revenue has scheduled a significant system update over Labour Weekend, which means that myIR, phone services, and gateway services will be unavailable from 5 pm on Friday, 25 October, until 8 am on Tuesday, 29 October 2024. Businesses and individuals are advised to complete any urgent tax-related activities before the shutdown to avoid disruptions. Inland Revenue will notify the public if services are restored earlier than planned.

 

View the key changes here:


Your 2024 Annual Accounts


A friendly reminder: If you haven't already, please provide us with your 2024 accounting information so we can complete your accounts. To make this process simple and easy, we have created an online checklist for you to fill out.


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Important Upcoming Dates:

21st October

  • FBT Quarterly Due


28th October

  • GST 6 Month (April/September GST Return & Payment Due)

  • Provisional Tax AIM & Ratio method


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