NEW SYSTEM OF TAXING

Press, Volume XCVII, Issue 28528, 6 March 1958, Page 7

NEW SYSTEM OF TAXING

Preparations For

P.A.Y.E. This is normally the busiest time of the year for the Inland Revenue Department, with queues outside the office in Worcester street waiting to pay their income tax before a late-payment penalty accrues. There are still queues this year, but they are of persons wanting forms for P.A.Y.E. taxation, which comes into effect from April 1, or wanting information about the new system of collecting income tax and social security charge. With the rebate of up to £lOO on income tax payable on 195657 income—today is the last day for payment—the District Commissioner of Inland Revenue in Christchurch (Mr N. A. Rowntree) estimates that about 75 per cent, of the taxpayers have no tax to pay.

Many of those who are paying taxes are businesses or business people whose affairs are handled by accountants.

One man is busy all day handing out forms for the new system. There are six different types of return forms, four types of tax code forms, and five sets of tax deductions—for weekly, fortnightly, four-weekly, monthly< payments, and for shearers’ daily payments. Mr Rowntree expects that his office will need 400,000 of the employees’ declaration forms for the first year of P.A.Y.E. That allows for the employees who change their jobs during the year.

About 100,000 of these tax code forms have been distributed so far, and Mr Rowntree said it was obvious that many employers were obtaining them in bulk and distributing them to their workers. The department appreciated that. The onus was on every employee to obtain a form, and hand it to the employer. Otherwise, the employer would have to deduct tax under the “no declaration” table, which was at a very much higher rate. Unless a taxpayer wanted a special tax code Certificate, the code declarations should be handed to the employer, and not to the department, said Mr Rowntree. Every mail brought in some forms which should have been given to employers. •‘Married’* but “Single**

“It is amazing how many manned women who are working have cheerfully written ‘M’ instead of ‘S’ for their code,’’ M~ Rowntree said. “The pay clerk in one big retail business handed out forms, and practically all the married women gave their code as ‘M,’ although the form makes it clear that ‘S’ is the code if a husband is earning more than £125 a year.” The office has now received a good supply of all the forms and tables -required. The employees’ forms are carbon impregnated to provide a copy, and a new type of paper is provided in the monthly remittance forms for employees. No carbon is required, as the paper is chemically treated to produce copies by normal writing pressure on the original. The new system is bound to produce many more inquiries for his staff yet, Mr Rowntree knows, but he is quite pleased with the progress- being made towards its introduction.

“It may be interesting to see how the number of children compares with the census,” he commented. But he added a warning that the department has previous returns on file, and checks are likely to be made.