[Joolzr]

We just got hit for tax on OH's relocation expenses of $3000. Has anyone else had to pay this? Think he is on emergency tax band too. Grrrr.

Julie

[Incognito]

Hi,

How did this work? Who has asked you to pay it?

[Joolzr]

It was taken off by his employers. Although I haven't seen his pay slip.

Julie

[Incognito]

Hi,

oh ok. I was wondering as my relocation expenses have been stated as net of taxes.

What did his employer tell you before you came over?

[dbonnett]

This seems to be an area in a state of flux - there was a draft policy proposal from the government (http://taxpolicy.ird.govt.nz/index.php?view=549) to clarify the tax-exempt status of relocation expenses, but then I have seen some other, older, items (e.g. BDO Spicer Article (http://www.google.com/url?sa=t&ct=res&cd=9&url=http%3A%2F%2Fwww.bdospicers.com%2FuploadGaller y%2FPublications%2FSummer%25200607%2520Tax%2520Tod ay.pdf&ei=AyGASIS0KaS-iwHS46HGCw&usg=AFQjCNHX_pDtp5dBFJ7P0cU7ZcE-zof3BA&sig2=NajXMWxQEEbOtJ_KtYsWqg) from 2006) that indicate that relo reimbursements are taxable.

I would ask the employer to confirm that this is supposed to be taxed, but don't be surprised if the policy hasn't changed. Maybe they will fix this in the next month, before we arrive and put in for reimbursement :nice1

[eternalkiwi]

The proposed law change is still a discussion document, though when it is passed it is expected that people who have been taxed in recent years will be able to claim back the tax they paid from IRD.

Shawn

[Joolzr]

The proposed law change is still a discussion document, though when it is passed it is expected that people who have been taxed in recent years will be able to claim back the tax they paid from IRD.

Shawn

Well thats good news! Will have to remember to keep an eye on it. I love getting money back from the tax man.

Thanks

Julie

[James 1077]

Just to let everyone know the July 2008 tax bill has sorted this out and relocation expenses are tax free.

Importantly this is effective from the 2002-03 income year so it means that you can get a refund if you have paid tax relocation reimbursements since then.

A link to my work's release on this here (https://nztaxonline.deloitte.co.nz/news/default.aspx?id=8adcfc19-51b9-4465-aa5f-0ccca091b601)(if this doesn't work then let me know as I'm accessing it from internal servers so it may be a different link through t'internet).

Oh, and if anyone works for a company that has been grossing up these sort of expenses rather than make the employee pay the tax then you can claim this gross up back - get in touch with our specialists if you need help / further info (their details are at the bottom of the alert.

[dbonnett]

Excellent! Thanks for the update!
BTW: The link works fine from the Internet.

[eternalkiwi]

Great to see that the Government actually do listen occasionally (though I guess it is election year after all). Hopefully this becomes law before the election!

Shawn