Business and Tax Updates April 2026: IBBZ Accounting

Summary:

As we reach the end of April 2026, the focus now shifts from balance date preparation to finalising financial statements and income tax returns for the year ended 31 March 2026. This is a key period for businesses and individuals to ensure their financial position is accurately recorded and compliance obligations are met. 

With the new financial year underway, it is important to complete final reconciliations, review year-end performance, and ensure GST, payroll, provisional tax, and cashflow are correctly accounted for. Early action helps avoid delays and penalties. 

As Inland Revenue increases its focus on overdue returns and outstanding tax positions, ensuring that filings and payments are up to date is essential.

We also encourage you to visit our YouTube channel, Tax Accountant, where we share ongoing tax updates, compliance tips, and insights to help you manage your personal and business finances with confidence.

At IBBZ Accounting, we are committed to helping you stay compliant and plan with confidence. Our team is always here to support you throughout the financial year.

Thank you for your continued trust in our services. 

Key Business Updates

1. Official Cash Rate (OCR)

The current OCR is 2.25% (as at April 2026). The next review is scheduled on 27th May 2026.

What this means for your business

• Borrowing costs remain relatively stable in the short term

• Any changes will depend on inflation and economic conditions

Important Tax Updates

1. Increased IRD compliance on unpaid tax (credit reporting)

Inland Revenue has updated its process for sharing unpaid tax information with credit reporting agencies. While this framework already existed, the changes from April 2026 make it easier and faster for IRD to report significant overdue tax debt.

What this means for you

If tax debt is substantial and remains unpaid, it may be shared with credit reporting agencies.

• This can impact your credit score, making it more difficult to obtain:

  • Bank finance

  • Trade credit from suppliers

• IRD may now take action sooner, with less direct contact required before reporting

Summary

We recommend ensuring all tax filings and payments are kept up to date. If you are experiencing cashflow issues, it is important to engage with Inland Revenue early and set up a payment arrangement to avoid escalation.

2. Investment Boost – now applying in 2026 returns

The Investment Boost (introduced in May 2025) is now being reflected in 2026 financial statements and tax returns.

• Businesses can claim a 20% immediate deduction on eligible new assets

• The remaining cost is depreciated as usual

Ensure assets are eligible and available for use within the financial year to claim the benefit.

3. Repairs vs Maintenance – What’s Deductible?

The Inland Revenue Department has clarified how repairs and maintenance expenses should be treated for tax purposes.

Key takeaway

Not all repairs are immediately deductible, it depends on whether the cost is revenue (deductible) or capital (non-deductible upfront).

Simple rule

• Deductible: Routine repairs that maintain an asset

• Not deductible (capital): Work that improves, replaces, or upgrades an asset

Two-step test to apply

1. Identify the asset

   • What exactly is being worked on? (whole asset vs part)

2. Assess the work done

   • Does it restore the asset? This is likely deductible. These are typically minor or recurring repairs. No major change to function or structure, keep asset in its original working condition.

   • Does it improve, replace, or extend life significantly? This is likely capital in nature. This usually involves one-off major work, rebuild, replace or upgrade. Improve its value or lifespan.

4. Tax Residency Changes for Visitors – What You Need to Know

The Inland Revenue Department is introducing changes to how tax residency applies to visitors in New Zealand, particularly those working remotely. The rules are being more flexible and allows people to stay longer than 183 days.

Who is affected?

• New Zealand visitors

• Both tax residents and non-resident visitors

A clear definition of a non-resident visitor

• The 183-day rule will not apply to these visitors

• New limit: up to 275 days in an 18-month period

Who qualifies as a non-resident visitor?

To qualify, a person must:

• Stay in NZ 275 days or less (within 18 months)

• Be a tax resident in another country

• Not have been a NZ resident before arrival

• Be lawfully present in NZ

• Not receive Working for Families or similar benefits

Work restrictions

To keep this status, visitors cannot:

• Work for a New Zealand employer

• Earn income from NZ businesses or customers 

• Perform work that requires them to be physically in NZ
  

Why this change?

• Supports remote work flexibility

• Provides clearer rules for visitors

• Reduces risk of double non-taxation

• Maintains fairness in the tax system

Visitors can now stay longer in New Zealand without triggering tax residency, provided they meet the strict conditions.