Will using Taxi affect my ICA?
No. As long as your Taxi account stays in good standing, your Imputation Credit Account (ICA) is protected, just as if you'd paid IRD directly.
What’s an ICA?
Your ICA keeps track of the tax your business pays. When you pay tax on time, it serves as proof that your company has settled its tax bill for profit made. This is important when it comes to distributing dividends to company owners or dealing with the IRD.
What happens when I use Taxi?
When you pay your tax through Taxi:
1. We receive your tax payment, and record the date it was received.
2. Your tax payment is transferred to a special government-owned bank account.
3. The IRD recognises this as a settled tax obligation.
As long as your Taxi account remains in good standing your ICA is protected, exactly as if you’d paid IRD directly. If your account goes into default, however, this protection no longer applies.
Is this approach approved?
Yes. An IRD product ruling confirmed that using Taxi doesn’t affect your ICA.
Why this matters
Other tax financing solutions will impact your ICA, meaning your business will forfeit its imputation credits when using other services. Yes. Taxi is the only tax finance provider in New Zealand with an IRD product ruling confirming that users' ICA positions remain protected while using the service, provided their account is not in default.