Section RC 27 — Income Tax Act 2007: Payment of provisional tax instalments when GST cycle changed

RC 27 Payment of provisional tax instalments when GST cycle changed When subsection (2) applies (1) Subsection (2) applies in a tax year to a person liable to pay provisional tax who— (a) uses the standard or estimation method to determine the amount of provisional tax payable; and (b) has been paying GST on a monthly or 2-monthly basis; and (c) changes to a 6-monthly basis under section 15C(1) of the Goods and Services Tax Act 1985. Changing to 6-monthly basis (2) The person must pay their instalments of provisional tax on whichever dates of instalments C and F for their corresponding income year occur after the change in taxable period takes effect. When subsection (4) applies (3) Subsection (4) applies in a tax year to a person liable to pay provisional tax who— (a) uses the standard or estimation method to determine the amount of provisional tax payable; and (b) has been paying GST on a 6-monthly basis; and (c) changes to a monthly or 2-monthly basis under section 15C(2) or (3) of the Goods and Services Tax Act 1985. Changing to monthly or 2-monthly basis (4) The person must pay their instalments of provisional tax on whichever dates of instalments B, D, and F for the person’s corresponding income year occur after the change in taxable period takes effect. Interest instalment dates in new cycle (5) If an instalment of provisional tax that falls on an instalment date in the new cycle is payable in relation to a period in the person’s original cycle that was, under that original cycle, an interest instalment date, it remains an interest instalment date in the new cycle. However, if the instalment falls on an instalment date other than an interest instalment date, the change does not affect the nature of the instalment. Formula for amount of instalment (6) The amount of each instalment is calculated under section RC 10 . Defined in this Act: amount , corresponding income year , GST , instalment date , interest instalment date , pay , provisional tax , tax year , taxable period , Compare: 2004 No 35 s MB 27