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Chris The Lawyer
Chris The Lawyer, Lawyer
Category: New Zealand Law
Satisfied Customers: 22412
Experience:  37 years qualified as a lawyer; LLB, MMgt and FAMINZ.
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I am Ari from Auckland. I have a tax/GSt issue with IRD.

Customer Question

Hi, I am Ari from Auckland. I have a tax/GSt issue with IRD. I have a dent of 140K with IRD(Tx & GST). Unfortunately due to family issues and no work I was unable to bay it. I would like to make a arrangement with IRD with a min ($1000) per month for a year and increase it in the next year. I have got a permanent job no and will be starting from mid next month. please advise me with how to approach IRD.
Submitted: 1 year ago.
Category: New Zealand Law
Expert:  Chris The Lawyer replied 1 year ago.
inland Revenue have a very good website and you can apply online for an instalment arrangement at this link http://www.ird.govt.nz/how-to/debt/options-difficulties/
Expert:  Chris The Lawyer replied 1 year ago.
I suggest you look at this and then ask me any questions arising
Customer: replied 1 year ago.
I have requested ird with my option, and they asking for full settlement or asking me to opt for bankruptcy. I want to pay it off and don't want go the bankruptcy way.
Customer: replied 1 year ago.
can they force me for bankruptcy or since i am starting a new job, will they deduct all my salary directly.
Expert:  Chris The Lawyer replied 1 year ago.
They don't usually let you get a discount unless you pay in full. I suggest you start paying but also fill out the hardship form and keep up the payments in the meantime. They don't always process the claims that quickly and if you start the payments sometimes they accept this, and don't push any further. Have you applied for hardship and completed a statement of position?
Expert:  Chris The Lawyer replied 1 year ago.
If they force you into bankruptcy then the Insolvency and Trustee Service will only deduct money from your salary if you can afford this, after considering rent and family needs. However before bankruptcy, Inland Revenue can deduct a specified amount from your salary but again have to take into account your overheads.
Customer: replied 1 year ago.
I am not asking them for discounts , only installments which i am capable off paying every month and for past few months I have been making this contribution($1000 +$1000). They have asked for my financial statement and have given 20 days.
Customer: replied 1 year ago.
after 20days they said they will go for legal proceeding. I don't have a house or any other assets. I only have a personal loan of 40K(which included a car loan) and i am paying it every month.
Expert:  Chris The Lawyer replied 1 year ago.
You must send the financial statements but if you do they won't take the steps until they have considered the financial statement
Customer: replied 1 year ago.
with my new job's income, I can save save $2000 and this amt I can use for IRD payments
Expert:  Chris The Lawyer replied 1 year ago.
So this can be shown on your financial statement, and perhaps in a covering letter or email
Customer: replied 1 year ago.
will they deduct more than $2000 from my salary forcefully.. I have my rent, loan repayment and living expense.
Customer: replied 1 year ago.
sure I will mention all these in the financial statement and send a covering letter too. in any case if they force me to bankruptcy or force cut from my salary can I defend my self.
Expert:  Chris The Lawyer replied 1 year ago.
I doubt they will. There is a maximum under the Tax Administration Act.
Expert:  Chris The Lawyer replied 1 year ago.
You can't defend the bankruptcy, but if they do so, the debt will be written off. You will find it easier to deal with Insolvency and Trustee Services about deductions in any event.
Customer: replied 1 year ago.
suggest me some option in this scenario...
Customer: replied 1 year ago.
if they force me on bankruptcy. will it affect my new job appointment. will they cease my car(I am still paying the installment for the loan). how long will the credit history be affected.
Customer: replied 1 year ago.
will I need to approach Insolvency and Trustee Services about deductions via a lawyer or direct?
Expert:  Chris The Lawyer replied 1 year ago.
You must complete the statement of financial position, and the response to this will govern your next steps. bankruptcy lasts 3 years and is on your credit record for 7. It won't necessarily affect your job, but you will have to tell your employer. It can depend on the sort of job you are going to. The finance company won't likely care if you keep paying but their debt could be written off and the car repossessed otherwise
Customer: replied 1 year ago.
is there any option to request ird to agree on my installment option after I submit the financial statement. in case of bankruptcy can I support my wife's loan application in future. will she be affected if I join her as a second applicant.
Customer: replied 1 year ago.
ideally I don't to end up in bankruptcy, I want to pay the amt...
Expert:  Chris The Lawyer replied 1 year ago.
It's all in their discretion. But it won't affect your wife or her credit rating
Expert:  Chris The Lawyer replied 1 year ago.
It is either they accept or they make you bankrupt. There are no other options I am afraid

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