New tax rules bug business

By Chris Barton

Inland Revenue's new PAYE reporting requirements are again under fire - this time from small businesses complaining about the laborious task of manually completing monthly employer schedules.

Under the new rules, which came into force in April this year, computer printed schedules for the IR348 form will not be accepted from any employers.

"The chore of writing in by hand each employee's details each month is a considerable one," said Act MP Rodney Hide in a letter to Minister of Revenue Bill English.

Mr Hide also complained that IRD was giving preferential treatment to payroll company Comacc which has a gained a six month dispensation from the no-computer-printout policy.

He said another payroll company which had approached the IRD in October seeking to overturn the policy and reduce the "excessive burden" on small business had been "resolutely refused."

Mr Hide claimed IRD's actions had allowed Comacc to secure a considerable commercial advantage over its competitors.

"All we were doing was looking after our customers. I'm sure if the others met IRD's formatting requirements they'd be granted a dispensation too," said Comacc marketing director Steve Nathan.

He said Comacc's electronic IR348 form was virtually identical to IRD's paper form and available to about 3000 of its small to medium-sized business customers.

IRD corporate communications manager Rae Mazengarb denied that the reason for the policy was to encourage small businesses to move to ir-File - the departments' Internet-based electronic filing system which all businesses with payroll in excess of $100,000 a year are required to use.

She said a specification for computer-printed schedules will shortly be made available to all payroll developers.

Since its launch in April, the system has been plagued with teething problems which resulted in the IRD's help desk being overrun with enquiries from frustrated users unable to make the system work.

Ms Mazengarb said the help desk problems had now been resolved, but that some employers were still having difficulties getting their computers to accept their unique digital certificate.

To date 1600 of the 12,000 employers required to use ir-File have been exempted from the requirement until next year and 6700 have managed to file their April schedules - leaving 3700 businesses yet to achieve electronic delivery.

The system has also been criticised for working only on Microsoft Windows-based PCs thereby giving preferential treatment to that platform at the expense of Macintosh, Unix and other computer systems.