Excess imputation credits carried forward.

[777]

Not all of us are as keen in offering financial advice via a forum, which was clearly what was being requested.

It's not compulsory.

[Aaron]

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.

[kerryo]

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.

Thanks Aaron, IRD neglected to tell me that when I rang to discuss the situation.

[Aaron]

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

[artemis]

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.

[kiora]

I am about to turn 63 and have a low income mainly derived from my share portfolio dividends and some schedular payment work.
In my last IR3 IRD return I had for the first time "excess imputation credits carried forward"
It appears that that these can be used against future income to decrease my tax liability, and not for anything else.
In my case it is most likely that I will have more surplus imputation credits this year to add to the current ones.

When I reach 65 and receive the pension, would I be able to start writing the excess credits off against my pension income?
I have been told by the IRD that when I die the credits will be used in my final summary of finances or if they still exist after that they will cease to exist.
It almost seems a waste not to use them up somehow.

Cheers in advance.

Imputation credits may be useful if a CGT is brought in

[nztx]

Imputation credits may be useful if a CGT is brought in

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% ..

[kiora]

Thanks for the clarification nztx