Okay, this is one of those rants that I have been planning for a while but have only now decided to piece it all together and type it out.
Firstly, check out this nonsense that appeared in the Sunday Star Times a week ago: http://www.stuff.co.nz/business/2585853/Tax-windfall-awaits-thousands
It is blatant advertising for a tax agency not a real news story.
The tax refund season has begun and thousands of Kiwi workers could find themselves with a nice big present.
Now workers can check to see if they are owed any of the estimated $100 million in overpaid tax for the 2009 tax year. And it could be more likely than you’d think.
At this point the story is reading like a nice ad for ird.govt.nz, okay good.
TaxRefunds.co.nz, a business that helps people file refund applications online, has calculated the chance of getting money back from Inland Revenue (IRD). For example, the table shows a worker on the average wage of $48,000 has a 20 percent chance of getting a payout with the average payment close to $245.
What! Advertising some dodgy company… hmm…
The probability climbs or falls depending on how much was earned. TaxRefund director Geoff Matthews said those hovering around the different tax brackets scored highly with those on $38,000 having a 55 percent chance of getting money back from IRD.
This is probably true.
“It’s like having a lottery ticket at the bottom of your drawer of course you’re going to check it,” he said.
Since when did filing a tax return turn into playing lotto? Unless you spend all your refund on lotto tickets.
… (5 more paragraphs of dribble, go read it on the link above if you have to)
If someone decides to go ahead and file the claim with the IRD, the company charges 12.5 percent of the rebate amount, up to a maximum of $500. The minimum fee is $12.50 per return.
Is there any news at all in this story? I don’t see any. All I see is advertising for some dodgy company and lotto. And lets make one thing very clear. Go to www.ird.govt.nz and do your own tax return there. You will get it all back and not give up 12.5% to some dodgy internet site.
Speaking of dodgy sites taxrefunds.co.nz seems to be getting dozens of complaints as highlighted here: http://tvnz.co.nz/business-news/ird-warns-online-tax-return-services-2706304
The Inland Revenue Department is warning people to be wary of online companies offering free tax return services.
This follows a number of complaints from people who say they didn’t realise what they were getting themselves into.
It’s ads like the current tax refund ones that Donna DeCleene thinking she was in for a windfall.
“I thought I may as well register and see if I have any money owed,” DeCleene says.
She went to taxrefunds.co.nz and typed in her IRD number to find out more about claiming back taxes.
But she was surprised when she received a letter from the Inland Revenue informing her that taxrefunds.co.nz would act on her behalf on all future returns.
“They were telling you to apply for old refunds not saying that they would then act for you in future years for any tax refunds,” she says.
The IRD says its received dozens of similar complaints about tax refund companies
“Read the fine print so you know what you are committing to before you do it. Or alternatively come to our website directly and you can do it for yourself anyway,” says Charles Ronaldson, Inland revenue.
When logging onto taxrefunds.co.nz you can see in the fine print that the company takes 12.5% on any refund, a commission that is also paid on things like family assistance credits and they will continue acting as your tax agent until you tell the IRD otherwise.
“It tells you on the site and you have to tick a box that accepts the conditions that we will be your tax agent like any chartered accountancy,” says Geoff Matthews, taxrefunds.co.nz.
Taxrefunds.co.nz was set up seven months ago and has already processed $62 million worth of returns
“I know I get a tax return through family assistance si i know i didn’t need them helping me because it’s all automated through IRD,” says DeCleene.
However Matthews says, “if we weren’t in the market nobody would know that they were due tax refunds”.
Mr Matthews people have been getting tax returns for much longer than the nine months you have been in the market. All it appears is that you are a very cunning scam artist giving people a service that they already had access to for free. It isn’t very impressive.
Finally be aware that IRD do seem to be on a go slow at the moment as highlighted here: http://www.nbr.co.nz/article/ird-go-slow-tax-refunds-angers-firms-102459 and http://www.gpforums.co.nz/showthread.php?s=&postid=6194020
I filed my tax return for 08/09 on May 12 and it took 9 weeks for them to process it, however, eventually I did get a refund and a nice big one too. So go and do your own. You will get more money and not get into bed with a dodgy company trying to take your money for doing nothing.