If you’ve been in New Zealand for a working holiday, and only worked for parts of the year, you can be pretty sure you’ll be due some tax back. And when it comes to claiming that tax back, it’s really not that hard. You don’t need to have a degree in accounting, there’s no secret password, really anyone can do it! That’s why it frustrates me so much to see all these tax back companies targeting backpackers, and charging a fee for their services.
When it comes to things like tax many backpackers panic and think it’s something they can’t deal with themselves. I once asked a friend if he was going to complete his tax return and he replied, “ehhh, I think I’m just going to use one of those tax back companies, they only charge $40 or something.” I told him how easy it was, that he should just do it himself and not lose any money, but he looked unsure and I could see he wasn’t convinced.
These companies may not charge much, but if thousands of backpackers are using their services and giving a small percentage of their tax back to them, then they’re laughing. So don’t give away any of your money, it literally only takes a few minutes, just do it yourself.
The NZ tax year runs from 1st April – 31st March so you can claim your tax back after this date. I’ve done my tax back 3 times now. There’s a couple of ways you can go about it through the IRD website, but this is how I’ve done it each time, it’s simple, and works for me.
1) Register for a myIR account
Go to www.ird.govt.nz and register for a myIR account so you can use the inland revenue online services. You just click on ‘register’, then select ‘a personal myIR account using your own IRD number’ and then follow instructions from there.
2) Check your income details are correct
Once you have your online account, login and click on ‘salary & wages’. Here, you can see all your income details and the tax you’ve paid. You can check it off your payslips to make sure it’s correct. You’ll also need the information here when it comes to filling out your tax return form.
3) Fill out an IR3 form
To complete a tax return you need to fill out an IR3- Individual tax return for 2014 from. This form can be found on the ird website. For help in filling out this form you should also download the IR3G- Individual tax return guide 2014. As long as you use this guide there’s no reason why there should be any problems completing your tax return correctly. By the end of the form you’ll know how much tax you should be due back. Don’t be expecting thousands of dollars, my tax returns have ranged from $300- $500.
4) Send your form in the post
Old fashioned but uncomplicated. Just send your completed form to the address stated at the end of the form. As long as you’ve entered in all the details correctly, you’ll have your tax back in your bank account usually within 2-3 weeks.
Some tips for filling out your form:
- If you are in New Zealand for more than 183 days in any 12-month period then you will be considered a NZ resident for tax purposes, so make sure you tick this option so you get the correct tax back.
- Don’t get confused by the form. As a backpacker a lot of the income questions, such as ‘family tax credits’, ‘schedular payments’, ‘maori authority distributions’ etc won’t apply to you. Just refer to the guide and you’ll find you just tick ‘no’ for all of these and move on to the next question.
- When it comes to the ‘tax calculation’ again it seems complicated, you actually have to do some maths! But it’s not as complicated as it first seems. Just follow page 42 of the guide and it’s foolproof. And because you probably ticked ‘no’ for the majority of income questions, there’s not that much calculating to do.
- In the ‘refunds and/or transfers section it’s most likely you’ll just want your tax refund refunded in full to yourself, so just tick the ‘no’ options.
Enjoy your tax back!