It's not compulsory.
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Assuming you get withholding tax deducted from your scheduler payment work and your tax affairs are in order you can apply for an exemption certificate from IRD to give to your employer/client so they stop deducting tax. Then you can fully use the imputation credits but might also end up with a bit of tax to pay at the end of the year as it has not been deducted at source.
This might be useful
https://www.ird.govt.nz/payroll-empl...es-wt-coe.html
Or you could reduce your withholding tax rate so you don't end up with a big tax bill at the end of the year, you just have less tax deducted at source.
https://www.ird.govt.nz/forms-guides...ntractors.html
If looking at companies that don't pay a divvy, Xero has announced it is close to profit and intends to use it for growth.
Assuming that with excess imputation credits, an effective 'tax prepayment for a future year' is capable
of transfer & offset. As tax effectively paid by the company paying dividend, I wouldn't be too sure
of chances of that..
Happen to notice that when company tax rates decreased from 33% to 28% - the 33% in either or combination
of imputation credits & Div Withholding tax didn't similarly reduce to 28% for company distributions paid out?
PIE Companies dividends however were just fine with the lower 28% top PIR rate- no problem in the interim .. ;)
X number of years later it still hasn't been fixed & with top tier taxpayers getting shafted harder in near future
on over $180k pa - it looks like DWT/Imputation credit coverage wont be fixed / lowered any time soon either
to 28% .. ;)
Thanks for the clarification nztx