Request an income tax transfer between entities

Overview

TaxLab allows transfer of income tax refunds between entities. The transfer request can be entered into the software, and is transmitted to IR as part of e-filing the income tax return. A maximum of twenty requests per tax return can be entered.

Add an income tax transfer transaction

1. From the entity's tax year summary select Workpapers > Tax Payments. 
2. Select New > Tax Transfer. This creates a tax transfer request transaction.
3. Update the details of the tax transfer request. The default transaction is a transfer to the next year’s provisional tax for the taxpayer. 
   • Transfer period [E-filed]: the tax year the transfer will be made to.
   • Transfer to account: the recipient of the transfer. This can be the entity itself, or another entity.
   • IRD Number [E-filed]: the recipient’s IRD number.
   • Is Associated [E-filed]: tick if the recipient is an associated entity.
   • Date: the date of the transaction. This is informational only.
   • Transaction [E-filed]: the account type at Inland Revenue the transfer is being made to.
   • Debit [E-filed]: the amount to be transferred. This is always entered as a positive number.
   • Is Pending: tick to incde the transaction in the payment schedule. It is ticked by default.
4. Optional: add a note.
5. Select Save.

If the transfer you have entered is for an entity in TaxLab and you want the corresponding side to be displayed in the return you will need to manually enter it, in that entity as a negative value.

To view the total transfers made for an entity and confirm they do not exceed the refund.

From the navigation bar select Reports > Tax Return Forms > Refunds and/or Transfers. A negative balance remaining indicates a refund.

Troubleshooting

Sometimes transfers may not be processed correctly by Inland Revenue even if they are filed correctly. There can be a number of reasons for that.

The transfers requested exceed the refund available

If a return is assessed with a lower than expected refund, IR will transfer what they can up to their assessed refund amount.

If multiple transfer requests are made, and the available refund is less, they will be processed to the extent of the refund available. Therefore one transfer may be less or some may not be processed at all. There is no way to specify the order in which transfers are processed.

The receiving account is locked

If the account the transfer is being made to is locked by Inland Revenue, they will not process the transfer. In this case the funds will be refunded to the taxpayer. This can occur if the account is marked as using tax pooling, or Inland Revenue deem the account to be closed, such as a past period.

Inland Revenue does not have bank details

Inland Revenue needs to be able to complete all the actions on a refund at one time. Where a refund is partially transferred and partially refunded, it will not be processed if they do not have a bank account to refund the balance to. Once Inland Revenue have a bank account, both the transfer and the refund will be processed.

Transfers in from tax types other than INC

TaxLab does not support transfers in from other tax types. We recommend you request these by using IR secure mail.

Related articles

Payment schedule 

Record tax payments